How can my mortgage choice loan consultant help me more than going direct to a lender? Convenience, experience and wider choice. Leading loan consultants, such as those from Mortgage Choice, have a wide range of financial institutions on their lending panel, thus they can offer you hundreds of loan products to choose from at the one time, while one lender can only offer a limited range of its own loans.
Finding the most suitable loan available on your own can be difficult. What's more, most loan consultants do not charge customers for their services -
Mortgage Choice loan consultants certainly don't.
Can my loan be arranged quickly? Yes. Firstly, a
loan consultant saves the time and hassle of you knocking on the doors of an endless number of lenders.
Secondly, the loan consultant handles all the paperwork and their experience saves you time. Thirdly, when time is of the essence, the loan consultant knows which lenders process loans quickly and efficiently.
Will I have to pay up-front fees?
Depending on the property loan product you select, you may need to pay fees up-front to cover the loan application and/or valuation of the property. Reputable loan consultants will not charge fees for their service to the client.
How does that work? Mortgage Choice loan consultants earn their money from standard commissions paid by their parent company, which is paid by the lender at the settlement of the loan. The company passes on a percentage of the payment, with the same commission rate applied regardless of loan product or lender chosen by the borrower.
Won't that cost me more than going direct? No. A number of banks and other financial institutions support the services provided by reputable mortgage brokers, who handle above 37% of all mortgages settled in Australia (according to a recent report by JP Morgan Fujitsu). Using loan consultants such as Mortgage Choice consultants saves the lenders costs they could incur themselves in promotion and providing equal localised face-to-face customer service.
What if I don't qualify for the size of loan I want?
Different lenders' policies mean they all calculate the amount of money they will lend differently. A key advantage of a mortgage loan consultant is that they can actually tell you the maximum you can borrow from each lender.
I'm not married. Can I take out a loan with a friend, family member or partner? Particular property loan products make this possible. However, you should get legal advice on how any exit process from the joint loan would work.
What is mortgage insurance? There are two types: Lenders Mortgage Insurance and Mortgage Protection Insurance. Lenders Mortgage Insurance (LMI) is dependent on the percentage of the property's value you'll borrow (Loan to Value Ratio — LVR). LMI usually applies to loans with an LVR of 80% or higher and only covers the lender, not the borrower, in the event of loan default or capital gains loss at the time of property sale. This is a once only payment by the borrower and in some cases can be added to the loan.
Mortgage Protection Insurance (MPI) insures the outstanding balance or repayments of a customer's mortgage. This insurance can cover such events as death, permanent disablement, temporary disablement and unemployment, depending on the selection by the customer. This is generally not a requirement of the lender, however should at least be considered by the borrower.
25-Sep-2007