If you’re thinking about buying your first home, or moving into a new one, you have probably thought a bit about your home loan.
But have you thought about how a mortgage adviser can help?
Here’s what you need to know about mortgage advisers, and what they can do for you.
What’s a mortgage adviser, anyway?
A mortgage adviser is an expert who works with borrowers to find appropriate lending solutions.
About two-thirds of new home loan lending in New Zealand is done through a mortgage adviser, according to the Commerce Commission, which is a big increase from 2014, when only about 30 percent was.
Mortgage advisers need to have completed relevant qualifications and be linked to a financial advice provider (FAP) licence on the Financial Services Providers Register – among other obligations.
What does a mortgage adviser do?
When you go to a mortgage adviser, they will usually start by talking to you about your needs and current financial situation.
They will work with you to determine how much you might be able to borrow, and the repayments that come with that – and look at how that aligns with your goals.
They will then work with you to gather the relevant information and documentation required to assess what lender and loan structure would be most suitable for your needs. They will then submit your information and application to an appropriate lender.
If you are not quite application-ready, advisers will often give some guidance on what you need to do to get there.
They’re also usually just an email or phone call away, to offer advice on the process and to help ensure the loan drawdown happens smoothly – as well as helping with things like your home loan structure. Often, advisers can negotiate a little bit on interest rates compared to what is advertised by the banks.
How much does mortgage advice cost?
Advice is generally free to the borrower. Mortgage advisers put in hours of work for clients who usually don’t have to pay a thing.
That’s because advisers are most commonly paid by commission from the lenders.
In some cases, where the lender does not pay commission, the borrower may be asked to pay a fee instead. This will be discussed and agreed upfront, before any financial advice is provided..
There may also be fees if they put in the work to arrange a loan for you and you decide not to take it, but this should also be made clear at the outset.
Is it just about the initial application?
A mortgage adviser can be a huge help during the initial home loan application, in terms of getting an approval and seeing the process through to settlement.
But that isn’t the end of the relationship. Your home loan adviser will be available to you throughout the life of your home loan, ready to answer questions when it’s time to refix or if you need to make changes to your loan strategy.
A mortgage adviser can be an invaluable part of your overall financial wellbeing.
Ready to begin?
If you’d like to reap the benefits of working with a mortgage adviser, get in touch with us. The team at LifeDirect Mortgages are home loan experts, so whether you’re moving into your first home, shifting into a new one or just wondering about making changes to your borrowing, we can help.
Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.
