The home loan you choose is just as important as the home you buy. Before you go straight to your bank and sign on the dotted line for the first loan you're offered, you should at least consider your options.
Here are five reasons why an Auckland mortgage broker could be a better choice than a bank.
1. You may be able borrow with a lower LVR
In October, the Reserve bank changed laws to restrict lending to home buyers. The new laws mandate that 10 percent of bank's residential owner occupier mortgage lending to high-LVR (less than 20 percent deposit) borrowers and no more than 5 percent of investor lending to high-LVR (less than 40 percent deposit) borrowers.
What people forget is that these laws do not prohibit high LVR lending, they merely limit its prevalence. With the help of a mortgage broker, you'll be able to shop around several banks, to find ones that have not yet reached their high LVR lending threshold and can offer you a loan with a low deposit.
2. A personalised service
Buying a home is one of the biggest decisions you'll ever make. Your home loan should reflect that – being a considered and tailored product that suits your needs and wants – not just a one-size-fits-all mortgage off the production line.
Choose the right Auckland mortgage broker, and they will consult with you to find out more about you and your needs. From there, they'll use their extensive knowledge and access to countless products to find a solution that perfectly fills your requirements.
This could result in a easier mortgage repayments and perhaps even a quicker settlement.
3. Know your home loan inside out
If you want to hold onto your money, you'll want to know as much as you possibly can about your mortgage.
Many people may be inclined to pay less attention to their mortgages' finer details, extra charges and interest rates. The small print on your home loan may not make for thrilling reading after all.
But the fact is, if you want to hold onto your money, you'll want to know as much as you possibly can about your mortgage. If you enlist the services of a hands on mortgage broker, they'll ensure that you're fully aware of all the extra charges, fees and rates that apply to your loan.
Even better they'll work to find a loan that has fewer charges and a better interest rate.
4. They have your best interests in mind
Mortgage brokers build their livelihood off of providing value by organising peoples home loans – so it's in their best interest to find you the very best mortgage possible. With a more boutique, personalised approach they right broker may be more inclined to go above and beyond to provide a useful offering.
This may include searching through products to find you a loan with a lower interest rate. As an example of how much this could decrease costs, let's look at a $500,000 loan over a 30 year term – an interest rate 0.5 per cent lower could save you as much as $60,000.
5. They'll do all the legwork for you
When applying for a home loan, there's a fair bit of administration and bureaucracy involved. Go through a bank and you'll have to endure the entire rigmarole yourself. Enlist the help of a broker and they'll help you through the entire process, taking as much work off your plate as possible and even helping you negotiate with your banks.
For a more personalised mortgage service, get in touch with a local broker at Mortgage People today. We've got decades of experience helping Aucklanders buy their dream homes, and we've learnt a thing or two along the way.