How to get the Best out of your Mortgage Broker

With so many different lenders and products available on today's market, consumers are turning more toward mortgage brokers for assistance with their home loan needs. There are many mortgage brokers that claim to find the best-suited home loan for their clients, but with 70% of brokers referring their business to the big4 banks, are they actually getting most competitive deals?

Does your Mortgage Broker have the experience to help you make a good decision?

Statistics show that mortgage brokers now write half of the home loans given they are able to provide some very useful services. Typical mortgage brokers can explain the basics of a home loan product, match your needs to lenders' products, and then assists with paperwork and application. A stand out mortgage broker is one that can be more of an educator or advisor rather than just a salesman and recommending a certain product due to the commission being received.

Generally, brokers that are accredited with Mortgage and Finance Association of Australia (MFAA) or Finance Brokers Association of Australia (FBAA) are required to adhere to higher education standards and ethical standards aligned to government requirements. All Find A Better Rate Mortgage Brokers are accredited with the MFAA and adhere to the high ethical standards when assisting our clients.

Tips on choosing the Best Mortgage Broker

Here are some helpful tips to ensure you make the right decision on a Mortgage Broker:

Do your homework before contacting a mortgage broker - Research the market first - This will give you the basic knowledge to ensure your broker recommendations are on target and their advice is correct.

Prepare questions for your broker - The best mortgage brokers should be able to answer your questions without hesitation and be able to provide clear reasoning on why products have been chosen.

Check what lenders are offered by the broker - Depending on which mortgage broker you speak with depends on what lenders you will have access to as each company has different options available, but generally have up to 30-35 lenders in most cases.

Make sure that you explain your needs - Write down a list of 'must have' options and a 'nice to have options' so that the broker is aware of your requirements and chooses the product based on your needs.

Understand your options - Before making a decision on your home loan, make sure that you understand the reason the product has been chosen and that it meets your requirements.

Find out the costs involved with the transaction - So that you can make an informed decision, make sure that you are aware of the costs involved with the transaction. For example, establishment fees, ongoing monthly or annual fees, breaking costs or even refinance costs if you are refinancing your home loan.

Ask if there are any refinance rebates - There are a lot of lenders currently providing costs up to $1,500 to cover refinance costs.

Check the mortgage brokers credentials - Although brokers may not carry their credentials with them, the will generally be listed on their website or can be located on the MFAA or FBAA websites.

Get everything in writing from your broker before proceeding - Make sure that your broker provides documents confirming the details of the loan such as costs involved and commissions paid to lender to confirm there are no hidden costs.

Do not rush your decision - Make sure that you fully understand the product and if there is something that you are unsure of, do your research before proceeding and seek legal advice.

Don't submit shopping applications - This is submitting multiple applications as this can impair your credit file. Up to four spread out over a 12-month period is classified as normal. Any more than this, especially close together, can cause issues ascertain finance in the future.

Find out how to make a complaint - Hopefully this is not something that you have to resort to but make sure that you are aware of how to make a complaint if required. Mortgage Brokers should be part of an external resolution scheme such as the Credit and Investments Ombudsman or the Financial Ombudsman Service which are both ASIC approved.