12-Jun-2008
Have you looked into taking out a home loan recently? Have you just started looking? Chances are you’re totally bamboozled by the range of options available – Fixed Rate, Low Rate, Split and Variable, Lo Doc Loans for the self employed, Non Conforming for those with credit rating issues, Bridging Loans and Reverse Mortgages. This doesn’t even take into account the number of banks and institutions and their various conditions and rates.
Particularly for buyers in a hurry who want to get an idea of their buying power and repayment commitments fast, mortgage brokers can operate as a single point of reference, providing a range of options from a number of banks and lending institutions.
What to Expect
The loan officer should explain his chosen strategy and borrowers should never hesitate to ask questions in order to clarify why a particular loan structure or bank or lender is being recommended.
Choice Home Loans say they deal with 30 lenders, and encourage borrowers to ask why a particular lending institution is being recommended over others to help bring about greater understanding and trust in an area where both are vital.
Borrowers should request all advice be in writing and run any arrangements past their solicitor to be sure there are no misunderstandings. All contracts should be reviewed by a solicitor before signing.
Industry Associations and Accountability
When comparing mortgage brokers a point of difference to look for is the MFAA logo on their website or marketing collateral. MFAA (Mortgage and Finance Association of Australia) requires specific mortgage broking education to qualify for membership and provides members with an education centre for ongoing training and development. It also offers buyers tools such as loan calculators and advice demystifying finance and home loan terms and on how to choose a loan broker or lodge a complaint. Not only do they provide a member’s list to assist in finding a reputable company, but also an expelled, or suspended, members list, a critical check point for home buyers.
Mortgage Industry Association of Australia (MIAA) the mortgage broker, Australia, professional association has been the driving force behind implementing a higher level of industry accountability including the setting of commissions and accuracy in advertising.
So, why use a mortgage broker? Especially with the industries growing credibility, having someone who specialises in and understands the intricacies of the ever increasing range of home loans just might be the answer to the question.