When meeting a mortgage broker, it's best if you brought your list of must-haves and nice-to-haves. Ask questions. Lots of them. Get the broker to explain how each loan option works, what it costs and why it's recommended to you. If you are not happy with any option, ask the broker to find an alternative.
You don't have to take the first loan you're offered. You may have a preference for a particular lender, such as your current bank. Ask to see loans from other lenders as well, so you can compare.
A home loan is a long-term debt, so even a small difference in interest adds up over time. If you can get a lower interest rate from another lender, you could save thousands of dollars.
Questions to ask your mortgage broker
- Do you offer loans from a range of different lenders?
- How do you get paid for the advice you're giving me? Does this differ between lenders?
- Why did you recommend this loan to me?
- What fees will I have to pay when taking out this loan?
- What features (options) come with this loan? Can you show me how they work?
- Can you show me a couple more options, including one with the lowest cost?
- What is the threshold for lender's mortgage insurance (LMI) and how can I avoid it?
- What information do I need to provide for the loan application?
Get a written quote from the broker
A written quote tells you the:
- Type of loan
- Loan amount
- Loan term (duration)
- Current interest rate
- Fees you have to pay (for example, broker's fee, loan application fee, ongoing fees)
Make sure you're comfortable with what you're agreeing to. Ask more questions if there's anything you're not sure about.
Never sign blank forms or leave details for the broker to fill in later. If you feel you're being pressured into signing, ask for more time to think about the loan.
