Home Loan Tips
As a general rule lenders with very low interest rates and low fees, have the strictest rules. So if you want to achieve a great rate, you need to have your financial affairs in order. This is one reason why we suggest meeting with us 3-6 months before you plan to get a loan. Prior preparation can help tidy things up and help present you in the best light to the lender. Despite these strict rules, our philosophy is to get the best for our clients. This means we push the envelope of what is normally accepted by lenders as we try to get them to bend their rules so our clients get a great deal. This often results in lenders requesting alternative or extra documents so they can be comfortable with the overall loan. On rare occasions we may need to do a complete rework of your mortgage broker home loan with a different lender, but this will be at our expense.
The next important step, particularly with variable loans, is to seek a ‘pricing discount’ from the lender so that a lower rate than advertised is achieved. In many cases our clients don’t even realize the background work we do on their behalf, but they do appreciate the end results.
Whilst we are very good at what we do, there are a number of our Mortgage Broker Home Loan things you can do to help;
Proof of income.
Most lenders will want to see proof of your income over time from two different documents. Typically your last payslips and last years payment summary. When planning for a loan, find these and keep them in a handy place. If you earn cash, bank it and then draw it to spend. A banking history (typically 3 months) can be used when payslips are not available. Banking history can also help self employed people when tax returns are not available.
Proof of good conduct on debts.
Lenders want to believe that you are the type of person that will pay the money back on time. If other debts like credit cards are over limit or show late repayments then this will go against you. Even if your credit card is below the limit at the end of a month and only went over because the credit card company added the monthly interest payment on to it. Any over limit for any reason is bad, so avoid this. If debt consolidating, most lenders want to see the last 3 months of your personal loan statements squeaky clean and 6 months of home loan statements squeaky clean. This is probably the most important mortgage broker home loan tip as failure to be on top of debt can then lead to credit file problems.
A good credit file.
Find out what your credit file says about you and if it is wrong, fix it immediately. An important aspect of this mortgage broker home loan tip is that these things do not fix themselves and fixing a credit file can take months. Even if everything is OK (ie no defaults), avoid doing things that add entries as many lenders consider more than 3 credit enquiries a year as being “credit happy” which is not a good thing. Some lenders even have automated credit scoring where this can result in an immediate declined loan. Simple things such as buying a phone and connecting electricity can add an enquiry against you, add a credit card and you are on the edge of acceptable credit score with some lenders.
History is exactly that, it needs to occur over time and most lenders want to see the last 3 months of your savings account (with the balance steadily increasing). To keep things simple, open a bank account just for saving your deposit, make a regular deposit each pay and when you have spare funds add a bit more. A good idea is to find out how much your future mortgage payment + rates + insurance will be, subtract your current home loan cost / rent cost and bank the difference. If you cant afford to do this then your planned loan is probably too big. Keep a day to day account for your normal spending and don’t pinch funds from the deposit account.
The bigger the deposit the better, so save all you can. Remember that there are more cost to buying a home than the purchase price, you will need extra funds for stamp duty, legal cost, bank fees, building insurance and removal costs. With regards to home loans if you can cover costs and 20% of the purchase price, then there would be no Lenders Mortgage Insurance (LMI) payable on a full doc loan. Another way to avoid LMI is to find a guarantor with equity in property that is prepared to help. Even if you can’t save 20% or find a guarantor, having 5% savings can work for first home buyers in certain circumstances.
Collect Knowledge – Call a Davies Home Loans Mortgage Broker today.
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We hope you enjoyed our mortgage broker home loan tips. Call us for more info and have a great day.
Mortgage Broker Home Loan
Mortgage brokers help borrowers in sourcing and applying for mortgage finance (for both residential and investment real estate purposes), and in refinancing existing mortgages. Because brokers represent a panel of lenders, they are able to offer their customers a range of products and tailor the mortgage to their needs.
Key Training Package qualifications for this industry include Certificate IV in Finance and Mortgage Broking and Diploma of Finance and Mortgage Broking.
Outlook for the sector
As the demand for housing finance recovers after the global financial downturn, this sector is expected to grow. By the end of 2016–2017, mortgage broker home loan are expected to be the source for 50–55 percent of mortgages nationally, up from current estimates of 40 percent.
The sector currently employees 13,740 people. Over the next five years it is expected to recruit over 3,000 more workers to reach
16,750 workers by 2018–2019.
Employment statistics on three key mortgage occupations are outlined below. Note these workers are employed across the financial services industry, not only in the mortgage broker home loan sector.
Employment in the mortgage broker home loan sector is forecast to grow steadily over the next five years, but businesses will need skilled labour in order to achieve revenue growth.
Customer service and communication and negotiation skills will continue to be important. The sector relies on experienced and knowledgeable staff to effectively communicate different loan products to clients, to negotiate the best deal with lenders, and to provide a high level of support and service to their clients.
Businesses will also need to embrace technology. Brokers should be able to use tools that help customers navigate information across different technologies. Social media, mobile and cloud computing are increasingly key tools for brokers.
Mortgage managers are a growing occupation in the broking sector. Unlike a broker, the Mortgage Manager is responsible for the mortgage from the time it is provided by the funding institution until the borrower’s payment of the final instalment of the loan.
Mortgage managers use funds from sources such as unit trusts, superannuation funds, securitised funds as well as banks.
Self-managed superannuation fund borrowing to purchase real estate will be a huge growth area for brokers over the next few years. More than 3,000 SMSFs are being established each month in Australia. Brokers need to ensure they have the right licence to provide this service and build good relationships with referral sources, such as accountants and financial planners, to access clients.