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The process of securing a home loan through a broker
According to recent research, prospective home buyers are using mortgage brokers to secure home loans because they expect brokers will save them money and assist them through the home loan application process.
If you decide a broker is for you, you can engage with them in a number of key stages throughout the application process and beyond.
Before application
Your broker will consult with you to establish your financial and lifestyle goals, responsibilities and commitments. You may have an idea in your mind of what you want, and the first meeting with a broker can help you refine this and develop the right action plan to make your aspirations a reality.
After reviewing your financial circumstances, your broker can determine your borrowing capacity and they can outline repayment scenarios. They must make reasonable enquiries to check if proposed products are suitable for you. They can also put you in touch with a variety of other complementary service providers, such as financial planners, real estate agents, lawyers and property agents, who will also help you achieve your goals, as and when required.
In preparation for a loan application you will need to supply some supporting documents. Examples of the documentation you will typically provide include personal ID, evidence of your income, proof of savings and details of existing financial obligations. Your broker is required to maintain confidentiality of the information that you provide and only pass it on where necessary to secure your finance or where required by law.
Your broker can also consult with you to explain how features, fees and charges attached to your loan options compare and affect the overall amount you will repay over the life of your loan.
Application
Once you’ve consulted with your broker to determine your preferred loan, they will submit your application and supporting documents to the lender.
Before you seek full home loan application approval, it’s also common to apply for home loan pre-approval. Click here to learn more about pre approval application.
Don't sign before approval
By signing a contract on a property prior to securing unconditional approval for a loan amount, you run the risk of forfeiting your purchase deposit if your subsequent loan application is declined. Pre-approval is less onerous than the full home loan application and gives you a good preliminary indication of your borrowing power.
Sky Blue Finance can assist you with applying for pre-approval as a step to help you determine which property price bracket may best suit you.
We will then let you know as soon as your lender has issued an unconditional approval on your loan application.
Approval and settlement
After your home loan application is approved and settled, your broker will follow up with you to ensure that you understand how to pay the loan and to answer any enquiries you might have.
The more aware you are of the support your finance broker has to offer in the home loan application process, the better positioned you are to navigate the process comfortably and successfully.
Post Settlement
The relationship with your broker should never cease at settlement. A good broker/client relationship will be one in which your broker is always there for you whenever you need. They should offer regular loan health check ups, and be available to answer any questions you may have during the life of your loan.
They will also keep you up to date and in touch with market shifts and current interest rates to continually make sure that you have the best loan set up for your financial situation.
Check us out at Sky Blue Finance and ask us how we can help you to ensure that your lender and loan is working the best for you.