The benefits of using a mortgage broker

28th Mar, 2022 | Articles, First Home Buyer

In this article:
Australians continue to turn to mortgage brokers to help navigate the complex lending market so we’re going to outline why it’s in your best interests to use a mortgage broker.

Do you know who settles nearly 70% of all home loans in Australia? It’s hard-working mortgage brokers.

Australians continue to turn to mortgage brokers to help navigate the complex lending market so we’re going to outline why it’s in your best interests to use a mortgage broker. Whether you’re a first home buyer looking to break into the property market, or a homeowner who hasn’t looked at their current loan in a few years, a mortgage broker can work with you to understand your situation and provide you with loan options most suited to your circumstances.

Generally, a lender pays the broker a fee for providing the service to you as a borrower, so essentially a broker’s services are free for most borrowers who use a broker, except for a few circumstances.

What is a mortgage broker?

Finding the right home loan can be complex and time-consuming. A mortgage broker is an intermediary between a borrower and a lender, who has the knowledge and expertise of the residential loan market to find a borrower the most suitable loan product for a borrower from a vast array of lenders. When it comes to researching suitable home loan products, handling all the paperwork of an application and giving you peace of mind throughout your home loan journey, mortgage brokers are there with you every step of the way.

Brokers deal directly with banks and lenders, to save consumers the hassle of having to try and wade through all the loan options in the market. Generally, the broker is NOT paid by the borrower, rather, they receive a commission from the lender when the loan is settled.

How is a mortgage broker different from a lender?

As a borrower, you have the option of organising your home loan directly with a lender, however, going to a lender means that you only have access to what that lender offers. Australia has thousands of home loan products offered by lenders, so visiting or researching each lender or their products individually is an insurmountable task. When it comes to finding the best home loan, with the right features to suit your specific needs, you want someone who can give you transparent and simple direction on which options are best for you.

Find the right loan features for your needs.

The benefits of using a mortgage broker:

1. A broader Product Range: Mortgage brokers generally have access to a panel of no less than 20 to 30 lenders. This means they can provide you with a selection of between one thousand and two thousand product options, across a range of lenders. The range of products available to you is therefore far broader than any single lender will have if you try to go directly to a lender for your home loan.

2. A better Product Match: Mortgage brokers are used to working with a diverse range of borrowers who all have unique circumstances and needs. For example, brokers can work with someone who has an impeccable credit record looking for the most competitive rates, to a self-employed person or a small business owner exploring minimal property deposit options. This experience, backed by their access to a wide range of products and industry-leading technology, significantly improves your chances of identifying a loan that suits you and your circumstances in a short space of time.

3. Using a broker won’t impact your credit Score: Your credit score is a critical parameter in securing a home loan. When you apply for a loan directly to a lender, they run a credit check, which gets recorded as an enquiry in a borrower’s credit file. Multiple enquiries could adversely impact your score. On the other hand, checks run by mortgage brokers do not get recorded as an enquiry and therefore leave no footprint. So, if you are doing some research and exploring your options, using a broker will ensure that there is no impact on your credit score.

4. Convenience: In addition to accessing multiple products at one single point, mortgage brokers are also a lot more flexible in terms of work timings, and they’re often available to meet when and where it suits you. After meeting with you and getting all the necessary documents for a home loan application, a broker can do the legwork to get your application approved whilst you can continue to go about your busy day.

As Mark Bouris says, “Using a mortgage broker is a no brainer for me. If you want transparency, simplicity and choice when it comes to your home loan, reach out to us today to chat with one of our experienced YBR Home Loans brokers.”

Get in touch with us today!