With lending criteria changing (and in many ways becoming more complex) a lot of Australians are now seeing the sense in using a broker. Some figures suggest that one in two Australian property buyers now choose to secure a loan through a broker. But that’s not the only reason. A broker is able to scan the market and provide you with a wider choice than if you simply go to your bank. Banks are highly competitive, and it is a broker’s role to find you the best loan for your circumstances, at the best interest rate possible. Even if you choose to stay with your current bank, a broker can sometimes negotiate a better deal on a mortgage than you might be able to on your own. That includes giving your current loan a ‘health check’ to make sure it’s still right for you.
No cost to you
Generally, mortgage broking services are free of charge. Brokers receive payment from lenders in the form of a commission and are required by law to disclose the details of these payments under the National Consumer Credit Protection Act to ensure transparency. You are entitled to ask a broker to provide details of their commission when you meet.
Save yourself time and stress!
At your initial appointment, a broker will ask you necessary information to research the mortgage market on your behalf. Comparing loans is not straightforward. A broker will save you time. Not just in finding the right mortgage, but throughout the application process, through to the purchase of your property and settlement too.
If you have an unpredictable income, or you have a poor credit history, a broker can help you secure a loan. In these instances, typically you’ll pay a higher interest rate, or be required to have more equity, but a broker can work through the details and help you decide if the loan is right for you.
It’s also a broker’s job to stay up to date with legislative changes to ensure that they are making appropriate recommendations and ensure that customers meet lending criteria. In the wake of the Royal Commission, the industry is expecting more changes, and brokers will be aware of these and what they mean for borrowers, so you can be assured that you’re getting solid advice in line with regulatory requirements.
Investors! Prepare for time.
With the financial year end just gone, it’s time to gather up your receipts and paperwork, and make an appointment with an accountant. And I do strongly recommend getting some professional advice this year to make sure you’re fully aware of recent changes to the tax rules for property investors. If you’ve been undertaking short-term letting with a platform like Airbnb it’s also worth checking out your tax obligations. The Australian Tax Office enforces strong penalties for false or misleading claims. The ATO website has a range of resources and info.
Keen to discuss further? Call us and we’ll set a meeting at no cost to you.