Ravi Chandran
Mortgage advisor is still essential because home loans unlike car insurance do not lend themselves to being compared easily
There are some advantages to using a mortgage broker that may be obvious however there are also several distinct benefits of which you may not be aware.
Here’s a breakdown of the main reasons to use a mortgage advisor:
- Getting “true” lowest cost
- Getting the best features and benefits as well as price
- Price comparison sites for mortgages don’t really work
- Getting exclusive deals
- Getting the best prices for conveyancing and other services
- Offloading the administration
- Having an agent to fight your corner
- Getting proper protection advice
- Effective implementation of tax planning
Get true lowest cost
It goes without saying that a Mortgage Broker will help you find the best product for your requirement’s both in terms of price whether that is the lowest monthly payment or overall cost during the initial term but also in terms of meeting other needs you may have such as for a drawdown facility or for the mortgage to be portable.
Why not use a price comparison site?
Mortgages unlike car insurance do not lend themselves to being compared easily.
The number of different factors affecting the overall cost means that working out which product is really the most cost effective is a complex and time consuming process that requires knowledge and experience that a comparison website typically does not provide.
It is very common for the lowest rate product to actually be much more expensive in terms of overall cost than other products with a higher headline rate and the complex nature of how fee’s are added to loans makes them difficult to compare like for like.
There isn’t necessarily any benefit in dealing direct
It seems obvious that dealing with a lender direct will cut out the middle man and lower the cost right? Not necessarily;
The majority of mortgage products are designed with broker commission built in and this will not be refunded to you or taken off the rate if you go direct.
There are some newer products which can only be arranged direct however this doesn’t mean that they are always the most cost effective product and by dealing direct the obligation to find the lowest cost is removed.
A bank can recommend any product to you that is suitable to your requirements and have no obligation to tell you if the bank down the road has a much lower rate.
Because mortgage advisors are part of a big mortgage network they have access to exclusive products you can’t arrange direct.
But what are the other benefits of using a mortgage advisor?
Firstly as mortgage advisor’s they act as your agent and that means they can assist you when things don’t go according to plan.
If your mortgage lender gave you incorrect dates for your first mortgage payment and you were left with a missed payment showing on your credit report it could impair your credit rating and affect future applications for credit but would you know what your rights are and how to get this corrected if it happened to you?
Would you be able to confidently argue your case with a lender who was refusing to accept your proof of identity if it was in fact they’re own error in underwriting?
Banks are big businesses and when they aren’t giving you a satisfactory outcome it can feel like David versus Goliath.
It can be a real relief in these situations for a mortgage broker with the knowledge and experience to argue a case effectively with these institutions to be in your corner.
Offloading the work
A large part of the mortgage broker’s role is actually administering the mortgage application and bringing together the necessary paperwork and documentation from the various relevant parties in order for the application to complete.
Put simply why bother doing this yourself in what is generally accepted to be one of the most stressful experiences you will ever have?
Being financially savvy
It may seem that once you have had a couple of mortgages and life insurance policies that the true benefit of advice is lost.
But the most important benefit of using a mortgage advisor is up to date knowledge of how to maximise the benefits of lenders and insurers.
But do you know how to arrange a life policy and prevent the proceeds from being incorrectly distributed in the event that your will was invalid (bear in mind that many deaths do not have a valid last will and testament).
The older and wiser you get the more benefit a mortgage broker can offer you as doors open and your financial options broaden.
