When looking for a home loan, primarily you have two main options: a mortgage broker or a bank. The selection between utilising a mortgage broker or getting a home loan directly from a bank will depend upon one’s financial condition and individual preferences.
When you want to refinance or looking for first home loan, you want the lowest interest rates and best terms deal on your mortgage. And Mortgage Broker and a Bank both provide a wide selection of mortgage options to choose from.
A mortgage broker might be beneficial for you, for instance, if you think you might have difficulties qualifying for a mortgage. On the other hand, if you want more control over the home buying process, you can deal directly with the bank and it completely makes sense.
When should you speak to a mortgage broker?
When you are ready to enter the property market or you have got a long-distance property goal in mind.
When you have saved up a deposit
So you have saved up some amount as a deposit for your new home! Now, a mortgage broker will explain how the process works, how much money you can borrow, what you can afford to spend, and what are other things to monitor during applying for a home loan.
2. When you are going for pre-approval
A pre-approved home loan lets you understand your potential buying power and give you a price range you can consider for purchasing a home, the amount you may be able to borrow so you can start searching the house, or plan your build, with confidence. Involved the Mortgage Broker at this stage and they will take care of the paperwork and other important details.
3. When you are refinancing your current home loan
Mortgage Refinancing is when you replace your existing loan with a new one. When you have decided to refinance, contact to a Mortgage Broker, they will let you know to whom you should choose your existing lender or a new one, the best interest rate and the term period.
What you should ask to a Mortgage Advisor
If you are a first-time home buyer or looking for refinance you might be wondering what questions you should ask to a mortgage broker.
A mortgage broker works like a bridge between you and a lender. They help you during the entire process, starting from identifying your needs, financial condition, your existing debts, paper works, giving your a number of lending options. They provide complete guidance on where you are and where you need to be to enter the property market.
Can you tell me about Government grants?
Mortgage Broker let you know how much should have in your KiwiSaver account for getting a First Home Buyers Grant.
2. How do you decide which loan is best for me?
They know the current market interest rates. First they analyse your financial situation (your existing debt, credit score) then acknowledge your needs, and sourcing the best rate to suit your situation.
3. Do you charge a fee?
Some brokers charge you a fee. But at Kiwi Mortgages, we don’t charge you (We get paid out by the lenders instead).
4. How much I can borrow?
As a first home buyer, first thing you need to think about is your budget. After analysing your financials, mortgage broker will provide you with the potential cost of your monthly payments and break down the expenses involved.
5. Are There Income Requirements For Buying A House?
Income does play a significant role in how much you can afford. Lenders look at all of your sources of income when they consider you for a mortgage, but there is no fix of dollars amount of income you need to have to purchase a home.
6. How much do you recommend I save up?
This will depend on the individual’s circumstances. A Mortgage Broker does their calculation for you and gives you a goal to work toward and suggests you some strategies that might get you there faster.
7. What Credit Score require for a mortgage?
The higher your credit score, the easier it is to get a mortgage loan. A credit score indicates how likely you are able to pay back the money you borrow.
How to Choose a Good Mortgage Broker?
There are lots of mortgage advisors out there, we always suggest that you ask friends and family for a recommendation or have a good look at the Google reviews for mortgage advisors in your area.
Additional Read: CHOOSING THE RIGHT ARMCHAIR FOR YOUR HOME