How Mortgage Brokers Work

Competition in the mortgage industry has increased significantly over the last few years. Banks and Lenders now offer literally hundreds of home loan products and while the options are great for consumers, they can be confusing. A good mortgage broker will help you evaluate your situation against the 30 or 40 lenders on their panel and help you to find the best one for you. A good mortgage broker will also negotiate on your behalf and help you with the co-ordination of your paperwork and make sure you settle on time. If you would like to talk to a mortgage broker about home loan options that are in your best interest, call us on 13 LOAN (or +61 2 9249 3739for international callers) or email us the form on this page and we will return your contact within 2 business hours.


* First Name:
* Last Name:
* Best Contact Number:
* Email:
* Postcode:
* Enter Word Verification in box:
		* indicates mandatory fields

How can Mortgage Broker Service be Free?

Most mortgage brokers offer a free service for residential home loans. How it works it that mortgage brokers offer their service to consumers at no cost and are receive a fees from the lender you place your home loan with. All lenders on the mortgage broker's panel pay these fees so it doesn't matter which one you choose to go with. Lenders work in this way because it gives them a bigger 'shop front' and allows them to reach a wider market without the costs of paying a traditional employee or the costs of opening up numerous branches. Some lenders like Citibank, ING, Bank West and Heritage have few or no branches and partly rely on mortgage brokers to represent their products.

Other lenders like Colonial CBA, Westpac, ANZ, NAB and St George have their own branch networks, but simply extend their access to customers through the mortgage broker network.

Simply put, the lender will pay the mortgage brokers fees and commissions. You do not pay any fees and the lender does not charge you more or increase your interest rate because you are using a broker. Rather, you are likely to get a better deal because the broker knows the lenders products, and has an established relationship with the lender that allows them to negotiate on your behalf.

To be sure you are being recommended to the right lender, just ask your broker to show you all the lenders on their panel, and what your loan options would be, against each lender's criteria.

What a Mortgage Broker Should do for You

A good mortgage broker will always start by asking you to explain your entire finance situation. For this reason, it is always wise to show up for your first meeting prepared - take your key documents so you can give the most accurate details to the mortgage broker.

Remember, the right loan is one that has flexibility for any changes in the future, so little things such as your future plans can make a big difference when choosing a suitable loan product. Your broker should:

Discuss and confirm loan options in writing
Explain
all documents of the loan application and help you to complete the
the loan process, from application to closing
all associated costs and fees of the loan application
the disbursements
Communicate with you throughout the loan process in a timely manner
Follow up the lender for you from application through conditional and on to unconditional approval
Negotiate with their lender/s to achieve the best deal
Offer you free Property Value Reports (Check they subscribe to RP Data)

How do I know a Mortgage Broker is any good?

Getting a good mortgage broker is crucial to getting the right loan. You need to ascertain that they have experience and qualifications, as well as being committed to the industry code of practice. You also need to ensure that the broker is right for you, the home loan application process is a stressful one - you cannot afford a personality clash. A good mortgage broker will ensure that your needs are met in a stress-free manner.

Here is a step-by-step checklist that will help you know if your broker is on the level.

For residential loans, all of the broker's services should be free i.e. is the whole service of giving you
Information in relation to home loans, negotiating the loan for you and handling the paperwork through to approval
The right broker will take the time to really understand your entire finance situation, both now and into the future
Your broker should have a range of home loans from a wide variety of lenders, e.g. banks and non-banks, conforming and non-conforming
Ensure your broker is not just an agent for one lender
Check the qualifications and experience of your broker, even ask for references from previous borrowers
Are they a member of the professional mortgage association (MFAA - Mortgage & Finance Association of Australia / FBAA - Finance Brokers Association Australia)?
Make sure your broker discloses all commission and payments received so you can judge whether a particular loan recommendation is being influenced by how much the broker will be paid
Ask your broker to show you on their computer how the loans they offer compare for your situation. Good brokers should have the appropriate software and be able to clearly outline their criteria and logic
Ask your broker how they comply with the Privacy Act to ensure the security of your personal and financial details
Your broker should have appropriate insurances
A good broker should be able to explain the most complex loans in plain English
Ask for testimonials - what other customers have said about them
It is up to you, but it really helps if you actually like your broker as well!
Ray White finance - a Professional Mortgage Broker

More information or help

For confidential assistance with your home loan or to talk to your local mortgage broker, call us at any time on 13 LOAN or call our direct line on +61 2 9249 3739.