Refinance Companies
Refinance companies are organizations who arrange the refinancing of existing loans held by borrowers. They can be banks, credit unions, building societies and finance companies generally. Access to the products sold by these refinance companies is often arranged by mortgage brokers.
In past times the banks and other lending authorities have mainly sold their product directly to their customer but as the market has grown along with demand and population growth, the role of refinancing companies in the form of mortgage brokers has grown also.
Mortgage brokers acting for refinance companies actually search out the banks or other lending authorities for the most suitable refinancing loan to suit the particular needs of the borrower they are representing. In some countries the mortgage broker charges a fee for the service offered and in other countries the mortgage broker earns a commission from the lender who finishes up getting the business.
What is a loan refinance company?
Typically a refinance loan company is not one which specialises in just loan refinance is, but instead is a traditional home loan lender who is able to help you upgrade your home loan to one of their home loans which fits you better. Having said that refinancing a loan is a different process to applying for a new loan and so you want to make sure that you are working with a home loan lender who is experienced with refinancing. To find out if the lenders you are comparing are experts in refinancing loans don’t be afraid to ask some questions such as:
- How many home loans do you refinance in a year?
- How many home loans of current customers do you refinance in a year?
- What reasons do people who refinance with you have for upgrading their loan?
- Can you explain the refinancing process?
- Do you think I am a good candidate for a loan refinance? Why?
Ask these few simple questions of a loan company will help you gauge how experienced they are with loan refinancing and the types of loans they typically refinance for their customers, and for customers of other lenders. You will also be able to gauge the types of loan refinances the company normally processes and if they say they typically focus on refinancing to help their customers consolidate debts, you may want to seek out a refinance loan company who specialises in the types of equity loans for renovations which you are after. Also getting an honest answer to these questions, especially the last question where the lender could risk losing your business if they tell you there are better options for you, can help you determine whether this is a company you want to work with because they will be honest with you, upfront with their information and be happy to help you understand the process.
How do I find a refinance loan company?
You will be happy to hear that your search for a refinance loan company is almost over because at Home Loan Finder we are in regular contact with Australia’s top lenders and refinancing companies so we always know who is offering the best loan refinancing deals for every type of refinancing need. All you need to do is make one phone call to us or fill out an online enquiry form and we can help match you with the refinance loan and refinance and which best suits you. We would then put you directly in touch with your chosen refinance loan company so you can discuss your needs an application with them face-to-face.
What services does a refinance loan company offer?
You should expect more from your refinance loan company because you are making the decision to switch not only to save you time and money from your mortgage, but you also expect to receive better service with your improved product. As a result the loan company you refinance with should be able to help you with:
- Refinancing to consolidate debts.
- Refinancing for more affordable loan repayments.
- Refinancing for home improvements.
- Refinancing to access cash to improve your lifestyle; helping you pay bills, paper or holiday, or even a new car.
- Refinancing when you buy another home.
- Help with making the decision to refinance, as refinancing a lone a loan can be an expensive process, and your lender should be able to tell you whether it is the right option for you and which loan product you need.
- Managing your new loan and understanding all of the new features you have which can save you money.
- Communication and assistance if you feel you are becoming unable to manage your home loan or your other finances.
How should I borrow the money to refinance?
When looking to refinancing you will no doubt be confronted with the question of how will you go about making the transaction. Which refinance companies are best suited to refinancing generally?
There are literally hundreds of refinance companies out there vying for your business but they can be broken down to three main groups:
- First of all there are the banks, credit unions and building societies. Some banks are government owned but the majority these days are public or private companies and as such are responsible to their shareholders and owners to make a profit. The selling of their refinance products are simply a means to that end.
- Mortgage refinance companies are private finance companies who lend out their own investors money. Their investors are usually stockholders in the company and are there simply to receive the best return on their investment that can be achieved.
- The third are mortgage agencies. A mortgage agency is in effect a company with no money of its own to lend out but earns a fee for referring business to a lender who has the product their client is seeking. It is the mortgage broker whose business has grown dramatically in the last 15 to 20 years as borrowers turn to them to sort out the vast array of different refinancing products available.
Aggressive marketing undertaken by some mortgage brokers in Australia since the late 1990’s has seen almost 40 percent of all refinance business go through their businesses.
They are regulated by the Australian Securities and Investment Commission (ASIC) through licensing and the Credit Ombudsman Service limited (COSL). Most are also voluntary members of the industry body Mortgage and Finance association of Australia (MFAA).
The Federal Government body ASIC will assume responsibility for all credit regulation and licensing in Australia from July 1, 2010. From April 1, 2010 all credit providers and finance brokers, which includes mortgage brokers representing refinance companies, will be able to register with ASIC. Those who do register during this period will have until December 31, 2010 to make application for an Australian Credit Licence (ACL).
It will become an offence from July 1, 2010 for a mortgage broker or other credit provider to carry on business as such if they are not registered or licensed with ASIC.
When looking to refinancing you will no doubt remain confronted with the question of:
- How will you go about making the transaction.
- Which refinance companies are best suited to refinancing generally?
Home Loan Finder can simplify all this for you as we offer independent refinancing advice because we are not affiliated with any banks, refinancing companies or agencies. If you want to find out more about refinance companies and what they can offer please feel welcome to contact us.
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