Upon speaking to a few of the attendees after our first A.B.C 'workshop', some of the discussion was debating whether it is worthwhile to use a mortgage broker. Just like the stereotype that Real Estate Agents are 'Dishonest, all rich & don't work hard', Mortgage Brokers have their own stereotypes of having hidden agendas, again being dishonest and that 'Cost free service = hidden costs'. All of which are extraordinarily untrue. We wanted to dig in a little bit with a reminder of why we give a push to first home buyers, or anyone for that matter to use a mortgage broker when considering purchasing. Here is why: WE CARE.

So, let's let the stats do the talking... Here are some key differences between using a Mortgage Broker and going directly to a lender (bank):

PRODUCT RANGE: Mortgage brokers have access to no less than 20-30 lenders with over 1000-2000 products. When you go direct, you are limited to what the lender offers.

PRODUCT MATCH: Mortgage brokers take the time to understand their client's situation and needs. This information and access to a wider range of product significantly improve your chance of finding a product that suits you best.

CREDIT SCORE: A credit check run by a lender gets recorded as an enquiry on your credit file. Multiple enquiries can adversely impact your score. Checks run by mortgage brokers do not get recorded. When doing your research and exploring your options, using a broker will ensure there is no impact on your credit score.

CONVENIENCE: As well as having access to a wider range of products, mortgage brokers are a lot more flexible with timings. You are restricted to office timings and locations when using a direct lender.

So, if a Mortgage Broker is so great and helpful, how can it be a free service?
Mortgage Brokers are essentially referral agents to banks. Mortgage brokers are paid by the banks and lenders when you successfully get a loan. They're paid a commission by the lender that you end up going with. Mortgage Brokers retain a large percentage of their clients from referrals. This means, they want to provide you with the best service possible and find you the most suitable option, to leave you satisfied and wanting to recommend their services to people you know.

Without digging into what they really do and why they do it, it can be easy to fall into the trap of subconsciously believing what the 'general consensus' thinks.

There are still unsavoury characters in every profession. There are bad plumbers, mailmen, lawyers, doctors, and so on. The bad apples generally represent the exception to the rule, as opposed to the rule itself. However, if you're looking to get your finances in order and would like a trusted referral, we send all our clients to Pivotal Financial. Contact us and we will happily send through some contact details to their Mortgage Brokers in your area.