In a nutshell a mortgage broker is a financial mediator between you and your bank or lender. Their job is to look at your financial situation and find the best home loan to suit you.
First things first – are they licensed?
Check your mortgage broker is licenced and registered with the Mortgage and Finance Association of Australia (MFAA). They should also be registered with the Australian Securities and Investments Commission (ASIC), have an ABN number and an Australian credit licence.
What lenders do they represent?
Your broker should have a variety of banks and non-bank companies for you to choose the loan that suits you best. Also ensure your broker provides you with the full list of documentation required for the home loan process.
Does this loan suit me?
You need to be happy with the loan your broker offers so make sure you ask plenty of questions. What are the benefits, costs and risks? Ask to have the interest rate terms such as fixed, variable, interest-only, guarantor etc explained. These points are crucial to understand as they’ll establish both your monthly repayments and total loan cost.
When will I be approved?
It’s good to know pre-approval can take two to three days while full approval can take five to seven days to acquire. An evaluation of the property is usually also required. Be sure to ask your broker if there is a cooling off period before you sign. Once your application is approved you can look forward to moving into your new property.