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Why You Should Use a Mortgage Broker

September 4, 2023

Whether you’re looking to buy your first home or planning on refinancing your existing home loan, you might be wondering whether you should engage the help of a mortgage broker and how the process works. 

In this article, we’ll explain what the mortgage broking process looks like, as well answer a few common questions we get, so that you can have a better understanding of how we work.

Getting a home loan with a Mortgage Broker

What is a Mortgage Broker?

A mortgage broker is a home loan expert who works on behalf of the borrower. Their job is to find the lowest rate and best home loan deal from a variety of lenders. 

How do Mortgage Brokers work?

Mortgage brokers act as the intermediary between home buyers and lenders. They assess the buyer’s financial situation, preferences, and goals, then search through their network of lenders to find suitable loan options. 

By comparing various offers, they help buyers make informed decisions about interest rates, terms, and costs. The broker handles the application submission, negotiates with lenders, and ensures a smooth loan approval process. Their expertise streamlines the complexities of mortgage acquisition, providing buyers access to a range of lenders and tailored loan choices to secure the best possible mortgage deal.

How do Mortgage Brokers get paid?

At Connected Finance, we provide our credit and structure recommendations at no cost. It’s not just out of the goodness of our hearts (although the outcome definitely is), but out of necessity from the banks. By acting as an intermediary between you and the lenders, we are able to gain a commission from the applicable bank or lending institution.

It is important to note that the commission we receive from the financial institution will be fully disclosed to you in a formal contract, and in no way does this result in you paying higher rates of interest. In most cases, it’s often the opposite result; based on the ‘buying power’ we are able to offer amongst lenders.

We are fully committed to recommending products and lenders that are best suited to your needs and objectives, and no figure could ever influence our integrity.

Top 5 Reasons You Should Use a Mortgage Broker

Access to Multiple Lenders

Mortgage brokers typically work with a number of lenders, including banks, credit unions and private lenders. This means that borrowers have a broader range of loan options to choose from, but will only have to work with one person (the mortgage broker) as opposed to multiple (if communicating directly with banks).

Personalised Guidance

Mortgage brokers provide borrowers with personalised guidance based on the borrower’s financial situation, goals and preferences. They can recommend suitable loan options, explain complex terms and help borrowers make informed decisions that align with their needs.

Save on Time and Effort

As brokers handle most of the legwork involved in finding and securing a home loan, as a borrower, it means less work for you to do. Mortgage brokers will research available options, gather required documentation and navigate the application process, saving borrowers time and reducing the stress that is often associated with mortgage shopping.

Best Interests at Heart

Mortgage brokers are legally obligated to act in the best interest of the borrower when providing credit assistance. This is known as Best Interests Duty. This doesn’t apply to banks and lenders, so they aren’t required to keep borrowers best interests in mind.

Mortgage Brokers are Experts

Applying for a home loan can be a confusing process if you’re not familiar with it. A mortgage broker will strive to answer any home loan questions you might have and will make informed loan suggestions based on their knowledge of different products. Whether you’re in a unique financial situation (like self-employment or if your credit report is a little less-than-perfect) or you feel lost in the home loan process, a mortgage broker may be able to help you.

Should I Use a Mortgage Broker?

At the end of the day, using a mortgage broker is often the best choice for many people. Mortgage brokers can help you navigate the complex world of home loans, ensuring you find the most suitable deal tailored to your needs. They take away the stress and legwork of dealing directly with lenders, making your home-buying journey smoother and more convenient.

Consider talking to family and friends who have recently purchased a home. They can share their experiences with using a mortgage broker and might even be able to recommend a trusted local broker to assist you in securing the ideal home loan.

Appointments with Connected Finance come to you at no cost, so you don’t have anything to lose by booking in a time to chat with our team and learn more about your home loan options.