Mortgage brokers are professionals who assists people with financing their home purchases. In Australia their services are free as the lender the customer eventually chooses will pay the broker a commission. But the broker is usually not affiliated directly with the lender or bank where they are able to obtain funding.

The best mortgage brokers can assist clients with learning about different types of home loans (including owner occupied and investment loans) and the benefits of each one, including interest rates, fees, monthly payments, and financial documentation required by lenders. A mortgage broker will also be aware of concerns such as credit history and income verification that may affect whether a person is approved for certain mortgages

When applying for a mortgage through qualified professionals such as experienced licensed mortgage brokers in Sydney, you’ll likely find it much easier to get your loan approved along with a great interest rate than if you applied on your own or go straight to the bank.

How do mortgage brokers get paid in Australia?

Mortgage brokers are paid by lenders when they bring in new clients. This is called ‘broker remuneration’ or ‘broker commissions’.

The lender will pay out a small percentage of the loan amount to the broker, as an upfront commission. This can usually range from 0.5% to 0.7%. They also receive a small trailing commission each month during the life of the loan under their care. This can be anywhere from 0.05% to 0.15%.

Mortgage brokers don’t get paid if they fail to find you a loan, so there’s no risk in working with them and trying out their services!

It’s highly advisable to engage with one of the best mortgage brokers you can find at the very beginning of your mortgage project. No matter whether it’s your first home loan or looking to refinance an existing one. They can save you time, money and a whole lot of hassle in the long run.

It will also give you one point of contact throughout the process which saves time later on if you want to switch lenders or buy another property.

The number of lenders out there will be overwhelming to any first-time buyer. A mortgage broker deals with all different types of banks, credit Unions and building societies. So, they can offer you many options and help guide you on selecting the one that will benefit you the most in the long run.

A mortgage broker is paid by commission from the chosen lender, so they are encouraged to get you the best deal! You can ask them for their advice on the various offers available.

If you’re in the property market to buy a dwelling, one of the first things you should do is get pre-approved for the mortgage. Getting pre-approved for a mortgage is when mortgage lenders verify your employment, income, borrowing capacity and credit history in advance before you begin house hunting.

Think of mortgage pre-approval as a step closer to buying the home of your dreams.

In other words, mortgage pre-approval is the smart thing to do before seriously stepping into the property market, because it shows that a mortgage lender has checked your credit and verified that you have enough money to buy the home of your choice.

Lenders’ Mortgage Insurance explained, or LMI, is insurance that protects the lender, not you. It’s usually a one-off payment made by the borrower at the time of loan settlement. You will likely pay LMI if you borrow more than 80% of your home’s value (some exceptions apply).

Lenders Mortgage Insurance helps protect lenders against losses arising from defaults on home mortgages by borrowers who are unable to repay their loans.

So if something happens and you’re no longer able to repay your house loan, they’ll get some (or all) of their money back.

Call 02 8861 1689 to chat with one of our savvy mortgage brokers in Sydney to get more information on lenders mortgage insurance and how it would affect you.

The First Home Loan Deposit Scheme (FHLDS) began on 1 January 2020. It allows eligible first home buyers to enter the property market to purchase with as little as a five per cent deposit and without the need to take out lenders mortgage insurance (LMI).

Get in contact with us and we will be happy to provide you with more detailed information about this and other Government incentives.

Buying a house is undoubtedly one of the biggest life milestones and as such, it deserves plenty of planning. 

As you get started in the property market with your  research, it’s important to know how much deposit and possible purchase costs you’ll need to save up and what the average of these amounts are for Australian property.

The amount of cash you need for a deposit and other costs when buying a house is different depending on whether you’re getting an owner-occupier or an investment home loan.

Owner-occupier loans are used to buy your own place to live in, whereas an “investment” home loan is designed for purchasing property to rent out.

The traditional owner-occupied home loan requires the buyer to have saved up at least 5% of the value of the purchase price as a deposit.

Investor loans have larger deposits – usually around 10%. However, there are higher priced exceptions.

However, it’s worth noting that this percentage can vary significantly between lenders. You may also have to factor in purchase costs, which can include purchase stamp duty, loan costs and conveyancing costs to name the main ones.

If you’re a first home buyer you could also be eligible for grants and concessions.

Get in touch (02 8861 1689) for more detailed information that would be applicable to your personal situation.