When you’re buying a home, you need to do all the prior research to choose the right loan. We need to speak with the different loan providers, understand the process, negotiate the terms and secure the loan.

We can simplify this process and get the best loans now by enlisting the help of a mortgage broker in Australia. With so many loan options available in the market, the mortgage broker can help in securing the most suitable loan and offer additional help with the information of the loan providers and paperwork.

So, is it really best to go directly to the loan provider or use a mortgage broker? Let’s weigh the pros and cons of using a mortgage broker and make the best call.

Pros of Using a Mortgage Broker

1. Mortgage Brokers Do the Complete Legwork for You

One of the top mortgage broker benefits is that they will do the complete research for the loans.

Mortgage brokers are knowledgeable about the different types of loans in the market, the information about loan providers as well as the terms. Since this is their job day in and day out, we can trust them to provide us with sufficient information and guide us to the best loan provider and loan terms for our requirements.

Since they have dealt with many loan providers in the past, they know the repayment terms that will suit you and can steer you away from certain loan providers.

2. Mortgage Brokers Can Offer Quick Loan Comparisons

The mortgage broker will shop around on behalf of you and shortlist a few best lenders that meet your specifications. They have access to a whole set of lenders from the big national banks to small local lenders and credit unions. We can never have so many varieties of lenders to choose from, if not for the mortgage brokers.

3. Mortgage Brokers Can Prep You for Qualification

Your previous credit history can have a significant impact on the loan amount and the repayment terms you get.

The mortgage brokers have access to the same information as the lenders and can, therefore, match you to the right loan terms. It’s best to know how much your borrowing power is and approach only the right lenders instead of getting turned down by a lot.

This information about credit history can also help you to increase your reliability on your part and secure loans from lenders that weren’t once possible.

4. Mortgage Brokers Are Flexible with Their Appointments

For someone who is busy at the office and has a family to manage, the flexibility of appointments with mortgage brokers is something we’ll appreciate. They are pretty open about meeting times and locations.

You can even ask them to drop in at your home at your convenient time and have a detailed conversation about your loan requirements and your expectations out of the home loan.

5. Mortgage Brokers Can Help in Saving Some Fees

When you take out a loan, there are so many fees you have to pay in addition to the loan. These fees can total up to several thousand dollars.

The mortgage brokers may help in convincing the lenders to waive some of the fees and save so much of your money.

Cons of Using a Mortgage Broker

1. It’s Challenging to Choose the Right Mortgage Broker

There are so many mortgage brokers in Australia both new and experienced. Due to the high number of brokers, it can be hard to choose the best broker who will do right by us.

When we don’t choose the right mortgage broker, it can have a significant impact on the loan. Some brokers have tie-ups with loan providers and will only favour them while some have inside contacts and only recommend a limited range of products.

We need to look for the right mortgage broker who is entirely open about lenders and only recommend the best out of all.

2. There Can Be a Broker Fee

For the services provided, there’s a broker fee which is paid either by the borrower or the lender. When the lender pays the fee, then you need to be cautious about the loan that’s being recommended to you. There are chances that the broker may lead you to an expensive loan as the lender pays the fee.

If you’re paying the broker fee, then make sure to inquire about the amount and the terms of the fee. Make sure to get all the details upfront and figure out how much it’ll cost you on top of the loan.

3. The Loan Amount Is Only an Estimate

When the mortgage broker gives you an estimate of the loan amount and the repayment, it’s essential to understand that it’s only an estimate. The broker arrives at this estimate by considering your loan application and the lender terms. This may not be the final figure offered by the lender. There are chances that you may have to pay a higher interest rate or additional fees depending on the lender.

Choose a Reliable Mortgage Broker in Australia

Getting the help of a mortgage broker will save you so much time and effort. You can also get better insights into the market and secure loans with the best rates. However, choosing the right mortgage broker is the key. Make sure to spend sufficient time researching about the mortgage brokers in Australia and choosing the best one that can be fair.