Tips for Finding the Right Mortgage Broker for Your Home Loan
Mortgage brokers are an excellent way to find the best mortgage loans on the market and even arrange special deal financing. With so many lenders and various types of loan packages, a broker can help do the legwork in finding the best deals and comparing loan packages to suit your home loan needs.
It is advised to do some research in the mortgage market yourself so you know if the loan packages your broker brings to the table are competitive. You do not want to pay more for a mortgage loan than necessary.
Featured Mortgage Broker
Mortgage brokers receive a commission along with other incentives for promoting loan packages. This may cause them to be more promotional of one loan package over another. Unless a broker is under contract to find you the best loan deal, they are not obligated to do so.
If you limit your loan choices to those found by a broker, you could end up missing out on some cheaper home loans that may be available to you. This is because some lenders offer loans that don’t pay commissions and a broker has no incentive to offer them to you.
Mortgage Interest Rates
A half a point or so difference in interest rates may not seem like a big deal to you, but when you run the numbers you’ll see differently. On a $150,000 home loan with a loan term of 25 years, a 6.5% interest rate in lieu of a 6% rate would end up costing you around $13,900 more. That’s a substantial dollar figure to lose out on because of a half a percent difference in the interest rate.
Home Loan Shopping
There are different ways to shop for a home loan, including the internet, magazines, and lenders in your local area.
The CANNEX website is free and allows you to search for home loans based on your specific needs, helping you to find the cheapest package. You’ll find direct links to lenders so you can read further details on specific loans. The mortgage industry professionals use the website because it contains up to date information with plenty of useful home loan assistance.
There are numerous publications available dedicated to consumer finance and mortgage lending. You can browse through these and check current interest rates and shop for the best loans.
Check local lenders to inquire about special offers that may not be advertised heavily. There might be special offers for:
- Stock shareholders
- Superannuation fund members
- Professional organizations
- Employees of companies the bank has a special relationship with
- Advantageous Ways to Use Mortgage Brokers
When you determine the type of loan you want, calculate the loan fees and the interest rate you will most likely pay. Contact three mortgage brokers and brief them on the type of loan you are seeking.
If a mortgage broker offers you a special loan deal, get the specifics in writing and ask if the loan terms and conditions are identical to those the lender would offer you directly. Lenders will sometimes offer a loan package through a broker but stipulate special conditions, such as a high pay out fee if the loan is paid off early.
Mortgage Broker Tips
Not all mortgage brokers conduct business the same way. Just about anyone who decides to become a mortgage broker can do so. Some states do require a broker to register, but this does not guarantee anything as far as the way they conduct business.
The larger the amount of the loan, the higher the commission that is paid to the broker. While you should expect your mortgage broker to be responsible, you also should behave as a responsible borrower.
Do not ever pay a mortgage broker a fee up front to arrange a home loan for you. This is even illegal in many states. Most reputable brokers will not charge you a fee for their services. Their payment comes in the commissions and incentives they receive from the lenders for promoting their loan packages.
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Top Home Loans
| Home Loan | Details | Interest Rate (p.a.) | Comp Rate^ (p.a.) | App Fee / Ongoing Fee | Max LVR | Min & Max Borrowing | |
|---|---|---|---|---|---|---|---|
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|
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|
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 State Custodians Mortgage Company Standard Variable Offset Loan | Awarded Mortgage of the Year 2012 – this multi-award winner features 100% offset and a loyalty 0.25% rate drop after 5 years. | 6.02% | 6.23% | $0 / $345 | 95% | $150,000 / $1,000,000 |
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