Like many people, have you never really gauged why you'd use a broker? Have you ever thought "can’t my bank just organise my finance?" Well sure, but without a broker, it's a bit like going to a shopping centre, walking into the first shop and buying the third item you try on, because the salesman/woman was convincing and it was easy. But what if the pants were abhorrently overpriced? What if the dress is faulty and has holes? It's a bit like walking into a car dealership and buying the first car you test-drive because you didn't know there was a newer model at a better price down the road. How? Have a read below.
Let’s start with the basics— what is a finance broker?
They’re a tool. They are professionals who specialise in helping people find the best value loan for investment property, home purchasing, asset purchasing or corporate financing. They manage the application process for the client— outlining exactly what the client needs to move forward, and provide tailored advice along the way, helping clients secure the right loan with the perfect lender, in the most efficient way. Best of all, brokers generally don’t cost the client any fees at all. It's in their best interests to obtain the best value loan for a client, because if they client is happy, they will stick to their loan and when a broker 'brokers' a loan with a lender, the lender pays the broker a sort of 'finders fee', aka a commission. If the client withdraws their loan, the fee is taken right back by the lender! So it really is a broker's goal to find you a product you're happy with.
Now unlike some other types of brokers like those in insurance, or even travel agents, most finance brokers (i.e. us here at #LegalHomeLoans) are vendor-agnostic. This means that they have no predisposed incentive with lenders to use them; no special deals for us for signing with a lender, no special deals for us as a broker, to use a specific lender. Why? There are so many different products on the market, and quite frankly, there is no way a lender could incentivise any of their products to a broker enough to make those products worth using with a client. A client's loan is always so personalised and specific to their circumstances, that a pre-packaged loan product simply wouldn't work— particularly in the long run.
So point-for-point, how can a broker you?;
- The broker meets you at a time and place that suits you– at home, work, over coffee, during the week, at night
- They then look at your current loans and financial circumstances, and research and find the right solution for you
- The broker takes care of all of the paperwork in the process, ensuring all the details are met
- A broker provides more choices – equal to having options from eg. 20+ banks (lenders) with a variety of loan products rather than just options from one bank
- If you’re set on using your current bank/a specific bank – a broker can provide advice on which products to choose from within that bank with no agenda, unlike the bank advisors
- Brokers deal with lenders on a daily basis – they know what needs to be done, and therefore the process is done smoothly and EFFICIENTLY
- Banks/lenders change rules and regulations constantly. Brokers are always informed of these changes— their job is to keep up to date
- Brokers act as your personal advocate with the lenders— you trust them to do everything that needs to be done to get the loan, and their interests are in securing you as a long-term client, so trust that they’re pulling out all the stops!
- Mortgage brokers do all the searching for loan products, follow-ups and paperwork for the client— you don’t have to waste time doing so yourself
- A broker is the middle man between you and the lender
- Having access to a wide range of products allows the finance broker to focus on getting the right loan that saves you money— through lower rates, loans with lower fees, specific loan features to help pay it off faster, waived LMI costs, low deposit loans, etc.
- You pay less in the long run as an outcome of using a broker
- Once again, there is no cost of using a broker – it inevitably costs less using a broker because of the money they help you save.
Still not convinced? Still just want to go to a bank? Think about it. It’s hard for most people to choose the right option— it can be overwhelming with a lot of options out there, and banks have the agenda of securing you with THEIR company.
Banks are also mostly unaware of the comparisons between themselves and other lenders, and if they are aware, they definitely won’t alert you to this!
Overall, a finance broker is your best option for finding the best loan for you and your circumstances. It's an absolute no-brainer.
We hope our insider low-down on why you would need a broker provides you with a better insight on the benefits! If you have any questions or would like to have an obligation-free meeting, contact our brokers on (02) 9030 4020, +61 423 347 562. or email firstname.lastname@example.org.
We would love to help you out!