Why use a Mortgage Broker?

If you’re thinking of buying a new home in the near future, chances are you’ll need to get a mortgage. When getting a mortgage you have two options: deal with banks directly, or hire a mortgage broker. Dealing with banks can be difficult and confusing especially if this is your first time. So what about mortgage brokers?

What is a Mortgage Broker?

A mortgage broker is a middleman between you, the homebuyer, and mortgage lenders. They will assess your (aka. the borrower’s) finances, find appropriate mortgage products and advise clients on the right mortgage products for them. 

They’ll also apply for pre-approvals, gather necessary documentation, and complete applications on your behalf. Just like a real estate agent, a mortgage broker works for you and doesn’t get paid unless you take out a loan.

Whats the advantages of using a Broker?

A Mortgage Broker is bound by fiduciary duty. This means they are legally obligated to get the absolute best deal for you. They are not tied to any particular bank or lending company so they will review what is being offered and work out which one is best for you based on your needs and financial situation. This may include:

• Getting the best possible interest rates which will reduce your repayments’

• Using a home loan to finance other purchases

• Paying off the loan as quickly as possible

• Making sure that you get enough money for what you are wanting to purchase

How much does a Mortgage Broker cost?

In New Zealand just about every Mortgage Broker is free to use. Brokers receive a commission from the lender, not you.

Do the banks do the same thing as a mortgage broker?

No, they don’t.
A bank can review your financial situation, but they will only present to you options that they have on offer. There could be better options out there for you.

How does a Mortgage Broker save you time?

Your Mortgage Broker will also shop around at each bank and do all the comparison work, read the fine print, and negotiate the deal for you.

They know exactly what information a bank or lender requires. They ‘ll make sure you get all that sorted beforehand and will help you complete the paperwork for the loan application.

Why shouldn’t I negotiate with the bank/lender personally?

A Mortgage Broker has more negotiating power and is likely to get a better deal. You would also have to spend a lot of time doing your research on all the options such as interest rates and fees from all of the different banks/lenders. 

Your Mortgage Broker is on your team. They will negotiate the best deal for your needs armed with the knowledge and experience of the industry.

If you have any questions about the above information or would like to speak with an expert real estate agent about selling your home, contact us today for your free property appraisal or call Dylan Foote on 027 473 8371.