Questions to ask your mortgage broker
Buying a home is one of the most exciting life events we experience, but it can also be one of the most confusing. Once you have found your dream home, the next step is to obtain a home loan, which means talking to a recommended mortgage broker. However, before signing any paperwork, here are 5 questions to ask a mortgage broker to help ensure that you get the right type of loan with terms and conditions that you can live with.
1. How do you get paid?
Most mortgage brokers are paid a commission by the lender, and often do not charge the client anything. However, there have been instances of brokers recommending lenders who pay a higher commission, regardless of whether it is the right type of loan for the client or not.
A reputable local mortgage broker will always act in the client’s best interest, regardless of the commissions offered by the lender. Additionally, the mortgage broker should be happy to disclose how much commission they are being offered when performing loan comparisons. If they refuse, there is a good chance they are not acting in your best interest.
2. Who is on your panel of lenders?
Many people think that every mortgage broker has access to every lending institution and bank, but that is not the case. The Mortgage and Finance Association of Australia states that each broker is required to obtain accreditation with a lender before they can sell their products. This is known as their panel of lenders and is a representation of how many different products they can choose from. Therefore, it is a good idea to find a trusted mortgage broker with a large enough panel of lenders that they can offer you a choice of loan options.
3. Do you specialise in anything?
There are circumstances where you may need a mortgage broker that specialises in a specific area or at least has experience dealing with a certain situation. For example, you may be looking at purchasing multiple properties, or be self-employed, which means that your needs are going to be a lot different to a family who has saved a large down payment to purchase a larger home.
Likewise, a first-time homebuyer may want a mortgage broker who is experienced with new buyers and is happy to spend a little more time explaining every little detail in layman’s terms.
4. What licences do you have?
It is imperative that your mortgage broker has all of the necessary legal credentials. It will help to protect you to some extent if something goes wrong.
All mortgage brokers should have an Australian Credit License and their license number should be displayed on official paperwork, or when asked. They should also have professional indemnity insurance.
You can check through ASIC to ensure that their paperwork is in order and there are no misdemeanours.
5. How have you secured difficult deals?
Ask the broker about their experiences, specifically in how they dealt with difficult cases. This will give you an idea of how experienced they are, and how well they will manage issues if any arise.
At Tradebusters Connect we have selected a limited number of mortgage brokers in your local area to be members of our trusted directory service. We are sure one of them will be a good choice for you. Their contact details are conveniently available here on this website and you are free to contact them directly. Don’t forget to ask about their special offers!
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