If you need a home loan, there are 3 ways to go about it: apply with your bank directly, shop around for a deal yourself or get a mortgage broker to do it all for you.
For most Australians, going with a major bank or lender seems like a safer option because you have trust in their brand. It can be hard to put your trust in a broker you’ve never heard of before.
However, when it comes to mortgage broker vs bank, it’s important to separate myth from fact so you can make an informed decision.
Mortgage Specialist/Broker versus Bank
Pros: Mortgage Specialist/Broker
- Access to multiple banks and products, presumably meaning you will get a bank and product more suited to you.
- Pivotal Financial doesn’t charge you any fee’s for your service, although some Mortgage Brokers will.
- Pivotal Financial Specialists will come to you, whether its your home or work place.
- Pivotal Financial Specialists will work after hours to be able to meet with clients outside of work
- Industry body’s compliance requires Pivotal Financial and other mortgage specialists to disclose the full details of the home loan, including all fees.
- A Mortgage Specialist can shop around for you to get you a better rate and lower fees.
- Pivotal Financial Specialist have their own Professional Indemnity Insurance, should anything go awry.
Cons: Mortgage Specialist/Broker
- Pivotal Financial Specialists are license Mortgage brokers, but some mortgage brokers may not be who they say they are.
- Pivotal Financial DON’T charge fees, some do so make sure you always read to fine print.
- Pivotal Financial Specialists always have your best interests at heart. Repeat business and referrals are our favourite thing. However, a small number of brokers have chosen to put their commissions ahead of their customer.
- Many banks have an online or mobile banking sector, for extra convenience.
- You can do the shopping around yourself to decide which bank and product you want.
- Banks have branches
- Banks have been around much longer than Mortgage Brokers – this can often make customers feel more comfortable approaching a bank.
- The banker only has access to their own bank’s products.
- If your situation doesn’t fit the banks policy, you will be stuck. For example, Westpac requires casual employees to be in their job for 12 months minimum, but CommBank will take you after only 3 months’ employment – little things like this can often be the difference between being approved and declined.
- Bankers work bank hours
Mortgage Broker vs Bank – Conclusion
Over the last decade, the use of Mortgage Specialists/Brokers has been rising steadily, whilst customer going straight to the bank has declined, no doubt due to the numerous benefits associated with using a mortgage broker. I hope this has given a full overview of using a Mortgage Broker vs using a Bank.