When it comes time to take out a mortgage, most people head straight to their bank. But, many financial experts warn that if you follow this strategy, then you may miss many benefits. Why? Well, brokers can offer you a specialised service that a bank cannot. Let’s compare the differences between brokers and banks so you can decide for yourself.
While a bank can offer you a range of home loan options, they have a limited choice of products. These loans cater to the majority, so you may not be able to take out a specialised loan. Plus, a bank often cannot provide you with a private lender. So, you may find you discuss your loan options with more than one person. This scenario can be confusing and sometimes frustrating.
The good news is a broker typically has a vast range of home loan products that you can select. Therefore, if you are looking to secure a specialist loan, then you should be able to find what you need. In addition, you will be assigned a broker, and this person will be your point of contact throughout the loan process. Lastly, a broker can often negotiate with a bank on your behalf. Thus, you still have the reassurance that you are dealing with a reputable lender.
Other benefits associated with using a brokerage service are as follows:
Greater choice of loans. One of the biggest advantages of using a broker for home loan finance is they have over 50 different products. Whereas, a bank may have around ten.
Greater flexibility. Brokers negotiate with lenders on your behalf, and they assist you with your home loan application. Consequently, you have added support that can improve your loan approval rate. Banks, on the other hand, have set criteria you must meet, and often they give you minimal help.
Increased level of experience. Most mortgage brokers own their business and offer their client with support from the start to finish of a home loan. Hence, they commit to helping their clients long-term. Banks, on the other hand, tend to shift staff, so your lending manager may change over your loan term.
Specialised loans. If you are looking for a unique loan, then you need to talk to a broker dealing with this product. For example, if you are looking to build an investment portfolio, then an asset broker will find you suitable loan products. A bank, however, may not offer you the most cost-effective choice due to staff lacking specialist knowledge.
Following-up. When you apply for a home loan with a bank it is up to you to follow-up on your application. However, when you deal with a broker, they follow-up on your loan for you. Such a service saves you time, effort and frustration.
Personalised service. Typically a bank offers a client an option or two based on their requirements. Nevertheless, a broker will sit down with a client and discuss their personal and financial plans. Then, a broker will find their client a choice of products that are affordable and suit the client’s situation. They will also research the market and find the best-priced
Unlimited resource. Most brokers can answer any lending question you have in detail. Also, if you need to know the different between home loan features, then a broker can explain these to you. Bank staff, on the other hand, may not have authorisation to answer questions. Nonetheless, they may not have the experience or time needed.
Of course, when it comes to selecting a mortgage product, it is important to do your own independent research. This approach will ensure you are completely satisfied with your choice.