If you’ve found yourself in a bit of a financial bind, you may not know what to do. Should you refinance, take advantage of mortgage break offers by banks, or work out other ways to save money.
One or all of the above could be options, but which one suits your specific needs is the million-dollar question.
That’s where an expert mortgage broker comes in. With their expert knowledge of multiple bank policies, industry updates at their fingertips and a wealth of individualised customer experience, they could be the financial lifeline – or soundboard – you need right now.
Here are three ways a mortgage broker can assist you in this time of crisis:
They could save you thousands of dollars
Everyone’s situation is different. Which is why it’s a good idea to run yours past a mortgage broker for financial advice tailored to you.
This could even be more of a crucial step before you jump into temporarily pausing your mortgage repayments.
We recommend approaching mortgage breaks with caution and examine your situation first and to try to keep your repayments up for as long as possible by exploring other options.
A mortgage broker will be able to assist you in lowering your home loan repayments for example. If your home loan is still on an interest rate of 4 per cent or higher, then a drop to a rate of below 2 or 3 per cent may save you more than $500 per month. And this could be all that is needed to get through this period.
But there are also other options such as reverting to interest-only payments, consolidating other debts with higher interest rates, taking advantage of redraw repayments or fixing your home loan.
All options, which a mortgage broker can offer you based on your situation.
They work for you, not the bank
Mortgage brokers work for you and not the bank. They only get paid if they find you the best solution possible, so it’s in their best interest to keep you happy.
Also during times of crisis, emotions can be heightened, so having a mortgage broker on your side, or someone to do the negotiating on your behalf can take away hours of stress.
They can also reduce the obligation you may feel towards staying with your current lender and put your best interests first.
Navigating through the process of switching lenders could be something that just seems too hard right now, but it doesn’t have to be.
Doing the groundwork and reading the fine print is all part of their job.
You’ll also be able to take advantage of their wide network of contacts, after years of servicing clients in your specific area, which can be especially helpful if you’re new to an area or city.
Which leads us to our final reason.
They have the most up to date information on hand
Mortgage brokers receive daily updates from lenders on policy changes and relief packages available to homeowners.
And the best brokers know that there is not a one-size-fits-all solution to each solution particularly during times of crisis.
It’s important that mortgage brokers are on top of all changes in the industry and across what multiple lenders are doing, as each bank has slightly different approaches and policies, that are changing on a daily basis.
If you’re tempted to go direct to an online lender, remember that they can’t often give personalized advice, where a mortgage broker can.
Some online lenders are also limited to 80 per cent LVR (Loan to Value Ratio) and have specific and more restrictive lending policies. Your mortgage broker will be well across these policies, and know where to place deals to ensure they get approved.
Taking a balanced approach with advice and local based service from a mortgage broker in your area will allow you to navigate this terrain.
And during these times of crisis, many brokers are offering virtual meetings allowing you to deal with the one point of contact throughout the whole process.