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How to Select A Mortgage Broker in Australia?

Do you live in Australia and are looking to buy a property but don’t have the money for it? If you don’t, you might have to apply for a loan, either from a bank or a mortgage lender. However, both have their limitations. Banks have a complicated loan approval process, while finding suitable lenders is an uphill task, especially for the inexperienced.

In such circumstances, your best bet is finding a mortgage broker in Australia that helps you connect to a reliable and trustworthy lender and ensures you receive a loan at a reasonable interest rate while taking care of the necessary paperwork. It’s an excellent way of speeding up the process while avoiding the usual hassles. However, there are some things you ought to check before you hire the services of a mortgage broker.

Does the mortgage broker have a license?

You must check if the mortgage broker has a valid license before taking their services. You cannot work as a broker in Australia unless you have an Australian Credit License (ACL) granted by the ASIC. Brokers who don’t have this license can only work as credit representatives (ACR). So these are things you must check well in advance.

What interest rates can they help you get?

It is essential to know that brokers are different from lenders because brokers don’t provide the loans from their funds but help you find a lender. Lenders have different interest rates. An average fixed mortgage interest rate for three years would be 2.93% approximately, while the lowest variable rate is around 1.82%. Browse the broker company’s website to check the comparison rate fixed interest rate.

Which agencies do they work within Australia?

Some people prefer applying for a loan from a bank rather than private lenders because of the wide variety of options available and the lower interest rates. Before that, though, you need to find the right bank. Citibank, Macquire, Westpac, Bankwest and Suncorp are some of the financial agencies in Australia, famous for their client-friendly approach and lower interest rates. You must check if the brokerage company is associated with some of these in any way.

What kind of process do they follow?

The brokerage firm you select should have a hassle-free and straightforward process consisting of a few steps at the most. The first step would likely involve an initial consultation to understand your loan requirements, followed by negotiations with lenders to arrive at an appropriate solution tailored to your needs.

They should also provide you with a list of trustworthy lenders to help you choose, after which the broker would ask you to submit a few documents and applications to the lender. Ask the brokerage firm if they would stay in touch with you post-settlement to ensure you receive the best rates.

Do they act in your best interest?

The regulatory guide released by the Australian Securities and Investments Commission makes it mandatory for mortgage brokers in Australia to act in the consumers best interests, according to sections 158LA and 158LE of the National Credit Act.

Best interests involve providing loan assistance to the client while considering their circumstances, goals, needs and financial situation. It includes obtaining the correct information, understanding the customer’s goals and objectives, and making recommendations along with informed decision making. They must also prioritize your interest if there is a conflict of interest, as per the Regulatory Act 273.144.

Go through the testimonials

Browse the mortgage broker’s website and check the testimonials section to assess their client’s impression of them. While reading the reviews, see whether the brokerage is responsive, understand their personal and financial goals, and what impressed them about the broker the most.

These are things to look for in a mortgage broker in Australia before hiring them to help you get a loan suited to your needs. They will ensure a hassle-free process and ensure you get the best interest rates.

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