When you first chat to a mortgage broker there are some vital questions to ask. These answers will help you decide if you and your broker are a match.
Mortgage brokers say the key to finding the right broker is to ask about their experience and service. After all, it’s better to apply for a mortgage once and get it right, than to apply multiple times. Why? Well, multiple applications can have an adverse effect on your credit rating.
Knowing this, here’s how to nicely interrogate your broker.
1. What are your qualifications?
Taking out a home loan is a long–term commitment and a financial risk. Understandably, you’ll want to know you’re receiving the best advice. Asking a broker about their qualifications and experience, can help you understand if they are the right person for the job.
It’s also a good idea to ask about ongoing training, as the mortgage brokering industry and lending standards change frequently.
2. How have you secured difficult deals?
Ask the broker about their first–hand experiences. You want to know you’re in good hands if you have a ‘difficult to achieve’ loan. This will help you judge how well your broker can manage issues if they’ve encountered.
3. Do you charge for your service?
Most mortgage brokers are paid by lenders when they secure a home loan. As a result, they typically don’t charge for their services. But not all operate this way, so it’s important to ask if they charge this fee. Otherwise you may discover you have to pay them later on.
4. What can I afford to borrow?
An experienced mortgage broker will look critically at your income and debts. They’ll consider your number of dependents, income and financial obligations in order to determine what you can afford. By understanding your financial commitments, they can help set your boundaries.
5. What is the best available rate?
A good mortgage broker will give you a range of options. These should include several appropriate home loans with appropriate features and low rates from their panel of lenders. If your broker only gives you low rate options without features, this might be indicative of their inexperience.
6. What fees are associated?
All home loans incur fees and charges. Asking what these costs are upfront will give you better idea of the cost involved. You will also need to ask your mortgage broker about any long–term savings using home loan features. An offset account or redraw facility could help with reducing the amount of interest paid. Done right, these features could save you thousands.
7. What lenders are on your panel?
There are hundreds of lenders and thousands of home loan products on the market but, not all mortgage brokers have access to them. A mortgage broker needs to gain accreditation from a lender to sell their products. When a mortgage broker gains accreditation, they join a broker’s panel of lenders. The more lenders on the panel, the greater the range of products.
8. Do you have specialities?
If you’re not the average home buyer or investor, you may need a broker that specialises in a specific area. For example, if you’re self–employed or seeking to buy multiple investment properties, then knowing what your broker is capable of will help you know if they’re the right fit.
9. What happens if my circumstances change?
When you take out a home loan, typically over 30–years, a lot can happen during this time. You may get married, have children or change employers. You may even buy a business or become self–employed. This change in course and sometimes finances may mean you may have to adjust your loan down the track. Having a mortgage broker who can factor this in can make a huge difference.
Are you looking to crack into the property market with the help of a broker? Our brokers at eChoice have access to hundreds of home loans, and can help you find a cost–effective and competitive mortgage.