Why Should You Work With A Mortgage Broker?

Why Should You Work With A Mortgage Broker?

It is common in NZ for people to arrange a mortgage via a bank. In fact around four out of five mortgages are arranged directly with a bank. In most other westernised countries the proportion of mortgages direct from a bank is only about ten percent. In those countries the vast majority of people work with a mortgage broker to arrange their house purchase finance.

Few People Understand Mortgages

Mortgage debt

Mortgage debt

People tend to only buy a handful of houses during their lifetime, and as a result, are not very familiar with the workings of the mortgage market. So they are often quite naïve when it comes to discussing or negotiating a mortgage.

A mortgage broker has lots of experience and so they understand what is happening in the market and how to use that knowledge to help borrowers gain better mortgage rates and deals.

The Range of Mortgage Lenders

In NZ when people think of mortgage lenders their first tout is one of the main banks. However there are many other lenders that might be able to help them with financing their house purchase.

For example, there are building societies, regional banks, credit unions, mezzanine lenders and even private individuals. Few house buyers even know of these sources let alone are aware of the mortgages that they might have on offer. However a broker will be aware of these and can talk through the lending options with their clients.

Mortgage Brokers Are Paid On Settlement

A mortgage broker will lonely get paid once you have the financing in place unlike a bank mortgage officer who is paid a salary. This means the broker has to do a great job to firstly get your deal over the line and secondly to get good references and referrals for more business. So you can be sure they will be working hard to get you the best mortgage possible.

People Don’t Like To Negotiate

Negotiating with a banker

Negotiating with a banker

Let’s face it; negotiating is not a skill that many people have. And when it comes to dealing with a bank, people often feel intimidated and don’t want to upset their potential lender.

However, a mortgage broker spends a good portion of their working life in negotiations with e lenders. They know how to talk to them and how to structure a proposal so it has more chance of being accepted. Further, they also know how much a bank wants to get a mortgage especially if it stops one of their competitors from getting a mortgage. So the mortgage broker will be able to apply suitable pressure to negotiate a better deal for you.

Mortgage Brokers Know Current Offers

The range of mortgage products on offer changes with amazing frequency. The average person in the street would not be aware of all of the mortgage products they could consider but a broker has to keep on top of this data.

So a broker might find that a lower rate has become available since you last spoke to the bank directly. This will save you money and interest payments.

Speed Is Of The Essence

Due to the rapid change on mortgage offers, deals are often withdrawn. Your broker can help the process along. This can include the paperwork process and then perhaps even asking for a particular deal to be held over while you finalise the purchase of your house.

Mortgage Brokers Do Not Charge You For Their Service

Mortgage brokers are commission-based sales people. Their remuneration comes directly from the lender once the deal has been settled. The borrower rarely has to pay for any brokerage services in the mortgage industry. Make sure you do not pay any fees directly to your mortgage broker.

Only One Credit Inquiry

If you approach a number of banks they will each carry out their own credit checks. For many credit reference agencies, more frequent checks can count negatively in your credit report. It can be seen that you are not a viable lending option and are shopping around as you have been rejected by a possible lender.

However, if you go via a mortgage broker, they will run their own credit check which they will then supply to each potential lender. This not only saves time but also protects your credit rating.

Mortgage Brokers For Auckland Home Buyers



Banks are much more restrictive on their lending these days especially with the increased (Loan To Value) LTV ratio that was imposed at the end of 2013. Therefore it can make it a lot easier for borrowers to work with a mortgage broker to negotiate improved terms.

If you want mortgages in West Auckland you can look at this broker, while for those on The North Shore, this website http://northshoremortgagebroker.co.nz/can help. For people living in Hamilton, you can get some mortgage advice here. Talk to a mortgage broker and get finance for your dream home.

The Best Reasons to Use a Mortgage Broker

The Best Reasons to Use a Mortgage Broker

There are significant reasons to use a mortgage broker when looking for the best rates and terms any time you are acquiring a new loan, or refinancing an existing one. Mortgage brokers maintain regular contact with all types of lenders. They have the ability to perform quick comparisons between mortgage rates and terms from a variety of financial lenders. In addition, brokers have the ability to steer their clients away from specific financial institutions offering onerous payment terms that are often buried deep in a mortgage contract.

What Is a Mortgage Broker?

Mortgage brokers

Mortgage brokers helping clients

A mortgage broker is not the source providing financing for the mortgage. Typically, a mortgage broker is an independent, licensed contractor that is directly associated with licensed, independent brokerage companies. Usually, their fees are paid through commissions connected with mortgage consumers, which are usually individuals or family seeking financing for a home purchase, or refinance of their current mortgage. Generally, they can offer a variety of financing options because they work directly with a variety of lenders and mortgage banks.

Acting as an intermediary, mortgage brokers provide a valuable service by comparison shopping for the best mortgage rates and terms, keeping your best interest in mind. Because the broker does not originate the mortgage loan, but is providing the ability to source many options, they typically have a greater range of loans available at highly competitive rates.

More Mortgage Loan Options Available

Many financial lenders offer deals exclusively to mortgage brokers because they are relied upon as the gatekeeper for continuously providing suitable clients. These types of lenders usually do not provide direct access to the consumer. In addition, financial lenders often provide negotiable special rates to the broker because of the amount of business they generate each month and/or year. As a result, brokers often have more options available than attempting to get a loan on your own.

Saving Fees

If you have ever had a mortgage in the past, you know the dozens of fees associated with obtaining the loan. This often includes application fees, origination fees, appraisal fees and others. In many incidences, a broker can negotiate with the lender to waive a variety of fees, saving you thousands of dollars over the lifespan of the loan.

A Mortgage Broker Can Save You Time

Allowing the mortgage broker to do the heavy lifting eliminates your need to shop and call around, or research all the mortgages available in the marketplace. In addition, a broker can weed through the complicated terms offered by each financial lender, and steer you away from any confusing payment terms or high fees. In the long run, this can save you an exorbitant amount of time and energy, while still producing optimal results and possibly lower monthly payments.

Mortgage Brokers Act as a Go-Between

A mortgage broker can provide a valuable service by acting as a go-between in helping you complete the loan application process. Serving in your best interest, the broker can ensure that the lender receives all the information they need to close the loan. In fact, their motivation remains solid throughout the entire process, ensuring that the application is approved quickly and the loan processed faster, to ensure they get paid.

In addition, a mortgage brokers are familiar with the language of underwriters, making the process of approval much easier. They work as an ideal problem solver, and effortlessly handle the paperwork, resubmitting a loan package if a lender is not responding quickly.

Transparent Fees

Governmental rules and regulations keep the actions of mortgage brokers intact. By law, all terms and fees of the contract must remain completely transparent, with full disclosure of the rate being offered through the broker.

Mortgage brokers

Success – your new mortgage

Working with a mortgage broker is important, because lenders often want the paperwork presented to them in a certain way. Lenders prefer speaking the financial lingo, and might reject the loan on problems that can easily be corrected by the broker. Once an application is rejected, it is often nearly impossible to have the error corrected or explain any misunderstanding.

The best mortgage brokers have access to many more financial lending opportunities for individuals shopping around for the best terms and mortgage rates on a new or existing home loan. They work as an ideal intermediary between the borrower and the lender to ensure the lowest rates at the best terms.