Finding a lender and doing all the paperwork can seem like a mountain of work to be done before a bank will approve your home loan. Why not leave the hard work to a mortgage broker, they cost you nothing as they don’t charge fees.
A good mortgage broker will research all possible lenders for your situation and provide you with options that would take a person weeks of research.
Picking a lender is a complex task, which takes a professional time and research, to ensure you have the correct facility, not only for now but one that will suit your changing requirements. For example, what if you want to have a baby and change the structure of your loan to make it more affordable while you are only on one income? Some lenders allow switching of loan type or repayment without too much trouble, others will want to assess your whole financial situation and may require a new application.
Here are 2 real life examples where doing the research yourself could have cost someone their property and another person over $900 in extra interest.
Mick and Leanne’s story
Mick and Leanne had to move out of town due to work relocation and they rented their property in Newcastle out while they decided how permanent the move would be. Once they realised the move was permanent, they approached their own bank for advice. The staff member at their local branch told Mick that he would have to sell their house in Newcastle in order to pull together the deposit required to purchase a house at their new location.
Mick decided to ring Vision’s experienced finance broker Hamish after being referred by a colleague. Hamish talked to him about his situation and strategically worked out that he didn’t need to sell his Newcastle property as it was actually making money because of the relatively low mortgage on that property. Hamish advised him to refinance his mortgage from the bank he was with and that released enough equity from his Newcastle home to purchase the new property they wanted.
The key here is that Mick’s bank is only one option and are governed by their own policies and procedures. His situation didn’t fit with his bank’s policy so another option was needed. A mortgage broker can look at all options and find the correct loan to suit your specific situation.
Mick and Leanne now get to keep their property as an investment and benefit from the capital growth, which would not have been achieved if he sold it.
Peter and Kylie’s story
Peter and Kylie decided to first go to their own bank to get a loan to purchase their first home. They were offered a fixed rate of 4.29%, which was the current book rate for this major bank. They discussed this with some friends who had also recently bought a property and were referred to our experienced Vision mortgage broker David, to see what options there were for them outside of their bank.
Through discussions Peter and Kylie seemed pretty keen to stay with their current bank, however, David told them Vision could still do a loan through their bank for them, as Vision are accredited with all the Lenders. David then went the extra mile to see if he could get a better rate for them and after negotiation with their bank, David managed to get 3.99% fixed for 3 years. This will save them over $900 per year and the loan is written with their very own bank who wouldn’t offer them any better than the number on the bank’s rate chart.
The key here is to put up a fight if you want a better rate from your bank – they will not offer it to you. A mortgage broker works on your behalf to fight for the best deal that suits your situation.
It is important to understand that individual banks and credit unions have their own policies which vary greatly from lender to lender. If you approach any lender with your specific requirements, their policies may not suit your situation.
So, how do you find a lender that does? An experienced finance/mortgage broker has access to many lenders and can sit down with you and pick lenders for you that will work for your exact circumstances now and into the future.
Contact us today to see how one of Vision’s experienced mortgage brokers can help you.