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Astute East Brisbane's Finance Insights

Drawing on his industry experience, Tony Duncan shares his thoughts on industry changes, home loan requirements and a number of important areas to consider when planning your first home purchase or your next property investment. 

  • Writer's pictureTony Duncan

The Value of a Mortgage Broker

Updated: Oct 3, 2022

Purchasing a property is a big responsibility, easily one of the biggest decisions many of us will make and it's important to get it right.

It surely comes as no surprise that the vast majority of Australian’s take out a loan to pay for their mortgage. In fact of 10.3 million properties in Australia, there are currently 6.3 million that are funded by a mortgage. If you, like most of us, are looking to finance your future home with a mortgage, then this is a good article to start with to understand why you’d consider a Mortgage Broker to help through the process.

Sold home graphic
The majority of Australian homes are funded through a loan (Mozo).

The truth is, there’s a great deal to consider before making the leap into becoming a property owner so it’s important to understand the process. Additionally, there are few terms that it's worth becoming familiar with in order to understand the world you’re about to enter.

A few things to know include:

Will you have to pay Lenders Mortgage Insurance (LMI)? What exactly is stamp duty? Do you get a variable or fixed loan? Should you use an offset account? How much can you borrow?

Well in short, it's important to make sure that you get a loan that you can afford that suits your lifestyle, and that is also flexible enough for the years to come. If this is sounding like a lot of information- don’t worry. All you need to do is a give us a call and we can talk you through the process. Before you do, here’s a little about what you can expect with a few Q&A’s on why you might like to use a Mortgage Broker...

What is a mortgage broker?

A mortgage broker is a specialist whose services are employed to source the most suitable lending solution, specific to your circumstances. They act as an intermediary between the customer and lenders to secure a particular financial arrangement to fund the investment. Upon securing your finance, a good mortgage broker can also manage every aspect of your loan throughout the term and provide market insights to ensure you continue to have a product that suits your goals and objectives from first to last payment.

Here is a list of a few ways of how we help:

  1. Make the process easy.

A mortgage broker will liaise with your real estate agent to help keep the process easy and stress-free.

2. Give you choice.

Most mortgage brokers have a panel of lenders from whom they can source a loan for you. It essentially gives you access to a variety of lenders with a larger selection of products.

3. Help Find the right loan.

A loan with the lowest rate may not give you the options you want. A good mortgage will examine your circumstances and future plans to recommend a loan that is right for you.

4. Help you avoid pitfalls.

Many products seem to offer a great deal, but they may include penalties, fees and charges that aren't obvious. A mortgage broker can help you avoid taking out a loan you might regret later.

Home loan process Brisbane
A mortgage broker can help simplify the process.

So, why use a Mortgage Broker over a Bank?

Mortgage brokers can offer a more extensive selection of loan products. While a bank can only offer you its products, finance brokers can help you choose from a selection of loans provided by different lenders, including non-bank lenders. They have the knowledge and tools to compare often hundreds of products, and you get a loan suitable for your circumstances and needs. A mortgage broker will know which of the deals on the market at the moment will be appropriate for you. They will be your cheer squad, middle-man, team player and coach throughout the process.

A report commissioned with Deloitte by the Mortgage Broking Industry of Australia found that of all the home loans to exist in Australia, Mortgage Brokers arrange over 56%.

This role of brokers in the industry is vital as it drives both competition and choice with the major lending institutions in the country. Furthermore, it was found that it reduced the net interest margin by approximately 3%, putting that money directly back into the pockets of the home buyer. Ultimately, the client continues to benefit through this process.

The pandemic has in many ways acted as an accelerator for banking services and digital mortgage applications are increasingly being used by the banks with some success and learnings along the way. The challenge in having an algorithm decide your financial future can be a difficult one to get right, particularly if not all information required is submitted on time and in the correct order. A mortgage broker can help navigate that process, even if by correspondence only.

Here at Astute East Brisbane, we’re here to help. We want to make sure you have the right loan that fits your current situation and will take the stress out of the process. We’re here to keep things simple and help you find the loan that’s right for you. Then all you’ll need to do is find the house!

Family outside home graphic

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General Advice Warning: This communication contains general information only and in no way constitutes the provision of professional advice, nor should it be relied on as a substitute for financial, credit, accounting, legal or other professional advice. We have not taken into account your financial situation, investment objectives or particular needs. Before making an investment or financial decision, a person must seek appropriate independent professional advice and also consider whether this information is appropriate to their needs, objectives and circumstances. The author as well as their representatives, agents and employees give no guarantees and make no representations, express or implied, as to the accuracy, currency, completeness or suitability of the information contained in this document. Nor do they accept any liability whatsoever as a result of any information herein being incorrect, incomplete or unsuitable or as a result of a person in any way using or relying on the information herein.


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