Buying a house is a huge commitment. For 99 out of 100 people, it’s the most expensive thing you’ll ever do. Once you’ve signed that contract, you’re committed to it for however many years you’ve signed up for, and you’ll be expected to make your payment every single one of those months. That’s why it’s vitally important that you get the right deal on day one and make sure that the mortgage you agree to is the best mortgage for your personal circumstances. It’s a serious commitment, and you need to make sure the terms of that commitment are as favorable toward you as possible.
Despite that, far too many people go straight to their own bank for their mortgage and take whatever deal that’s offered to them. You might not think there’s anything wrong with that so long as you can afford it and it gets you the home you want, but you could end up paying thousands of dollars more over the term than you would have done if you’d used a broker. Not only that, but you could be trapped by terms and conditions that you’d never have agreed to if you knew you had options elsewhere.
To avoid the risk of that happening, it’s better to employ a mortgage broker’s services. Some people worry about that because they suspect that mortgage brokers are only there to make money from you, but that isn’t the case. While your broker will almost certainly charge a fee, you’re still likely to end up better off through using them – and here are five reasons why.
They Can Gain Pre-Acceptance For You
When you start the mortgage application process, you’ll probably be asked to pay fees. That might include product fees, valuation fees, booking fees, and more. That makes it extremely frustrating – not to mention upsetting – if your application subsequently gets rejected. It’s almost like playing the most popular slot Fluffy Favourites. Think about the way the games at an online slots website work. You pay for your bets upfront, but you only receive anything in return if the reels are kind to you and the right combination comes up. There’s no way of getting your money back if your bet doesn’t work out. This isn’t a criticism of online slots because that’s the way they’re supposed to work. You can and should expect more from a mortgage application process. A good mortgage broker will be able to tell you the odds of you getting accepted before you part with any money.
They Can Delay Their Fees
As we said earlier, a mortgage broker will probably charge a fee for their services. That doesn’t necessarily mean you’ll have to pay those fees upfront. In the majority of cases, a broker can arrange for their fees to be taken from your mortgage advance. They get paid when your mortgage completes, and the fees are paid from your borrowing. Of course, that does mean that you’ll be paying interest on those fees over the term of your mortgage because they become part of your loan, but you have the option of paying upfront if you’d prefer. Don’t assume you’ll be paying through the nose for mortgage advice – it’s seldom the case.
They Have Access To The Whole Of The Market
This doesn’t apply to every mortgage advisor, so always check their level of access before you agree to use their services, but a good mortgage advisor should have ‘whole of market’ access. In practice, this means that they can obtain quotes from every lender active in your territory and provide you with the best possible deal. Some brokers work with a limited panel – which is still better than going straight to your bank or making a hundred phone calls trying to get all the quotes yourself – but those that work with the whole of the market can give you the full picture. If a broker has the ability to work with everybody, you can sign up for your deal safe in the knowledge that it would never have been possible to get a better deal elsewhere. That’s what peace of mind is all about.
They Can See Deals That You Can’t
Strange as it might seem, some mortgage products aren’t available to the general public. There are even a few mortgage lenders that aren’t available to the general public. Certain lending companies and rates are only available to qualified professionals, which means you’ll miss out on them if you go it alone. This might even include your own bank. That’s right; you might get a better rate going to your own bank through a mortgage broker than you would if you booked an appointment in your local branch and signed up directly. This is a strange quirk of how the mortgage market works, and while you may have your own opinion on whether or not it’s fair, the fact remains that many of the best deals are reserved for professional-level access only.
They Can Help You Avoid Traps
You may or may not have heard the term ‘mortgage prisoner,’ but consider yourself lucky if you haven’t. It’s not a situation you’d ever want to find yourself in. There are hundreds of thousands of people – perhaps even millions – who are currently trapped in long-term mortgage deals with high interest rates. That’s because the terms of the mortgages they signed either committed them to high rates for five years or more, or precluded them from negotiating new deals when their short term fixed rates came to an end. Ultimately, it means these unfortunate individuals end up paying thousands of dollars more than they should have done by rights. It’s shameful that this is allowed to happen at all, but a good mortgage broker can alleviate this risk. If it’s what you want, they’ll get you a deal with a good initial interest rate and either a long-term guarantee of that rate or an option to renegotiate when it comes to an end.
These are five good reasons to use a mortgage broker, and there are no reasons not to. You’re not compelled to sign any deal they offer you, and getting the advice of a qualified professional with years of experience is never a bad thing. If you’re considering taking on a new mortgage in the near future, do yourself a favor and speak to a professional advisor first.