There's so many brokers. Do they all have access to the same bank deals? And when I get my loan, will my broker proactively identify when I should refinance - or do I need to do this investigation myself every year?
There are thousands of brokers and they will all offer different levels of service and will have access to a slightly different range of lenders.
A good broker will contact you at least twice a year to maintain a good understanding of your situation and any changes that occur in your life as well as evaluating your current loan with options available in the market. If you are chasing your broker for information, you may be better off with somebody new?
I would contact a customer when the benefits of switching are compelling compared to their current product, that would usually mean a loan with 0.50% better rate AND required features is available and suitable
Good luck with your investing
Great question. Most brokers will tell you they have access to around 40 lenders which is true, what they may not mention is that each aggregator which is the group brokers belong to, often have different lenders and often offer their own branded products as well.
This is often the fringe lenders so may not make a difference to your situation.
What is generally more important is finding a lender that have the features you need and the best possible rate.
Yes, you broker should be proactively reviewing your loan at least on an annual basis. You should also be contacting your broker if your circumstances change. For example a pay rise can be a great opportunity to increase your repayments or use some equity to renovate. Or for example if you are having a baby make sure you let the broker know so they can check out you repayments and the possibility of reducing them for the first six months after the baby is born while your partner is on paternity leave.
Hope this helps
Hi Daniel - Broker do have access to their panel and if you work in the Lo Doc space or commercial we have access to many more - they all specialise and have different niche markets they are more happy to approve.
It has been my experience we will break down a new enquiry into the "policy" and select lenders who are most favourable. A good broker will always review with a few lenders to provide the flexibility and choice for a borrower.
And .. lenders change .. their service levels change (from 3 days to 20 days) and so we need to adjust which lenders offer better service and value.
Most brokers on here will have access to the same products. However, some products on here are aggregator specific and may not be available to all brokers. Also, a broker who is an Australian Credit Licence holder can also go outside of their lender panel, if needed.
A good broker will keep in touch with you regularly, not just when they think it is time to refinance your loan. I call my clients a few times a year, and know a lot about what is happening in their lives. This also helps to plan for the future and cater for their finance needs down the road.
Hope this helps.
Great answers, thank you! I've also heard that there's clawbacks on broker commissions when customers refinance within 2-3 years.
Doesn't that disincentivise the proactive behaviour from my broker that I'd want as the customer? How do you handle that scenario?
That's also a good question Daniel but it should in fact work in your favour. Clawback is highest if you refinance within the first 12 months so that shouldn't happen unless there is a significant change to your circumstances. If I don't manage your loan to suit your needs and keep pace with the market, you will find someone who will and I will get clawed back, however if I manage your loan and find you a better deal, I will get commission from the new lender that will offset the clawback. I hope that helps?
As well as having access to a range of lenders on our aggregator panel, I also have access to Mortgage Managers space whereby the mortgages are originated from the banks' wholesale arms which gives us the ability to create market-beating loans.
You can find contact me directly on:
John J Maxwell
0434 544 225
Senior Finance Consultant
Cocalex Holistic Mortgage & Finance Consulting
Hi Daniel O
Just a quick note about the review process and relationship between a broker and the client.
Firstly the review process, at Announcer we run an ongoing project called Gemma. This is a simple call to the clients current lender on an annual basis to see if they can offer any better interest rates. This is a challenging market where we have seen a big change in pricing, this year alone we have saved our Announcer clients over $500,000 in interest costs!
Well worth just the proactive call and our clients love it when we save them money!
Secondly, we annually provide feedback to our clients on their lending affordability and equity position which provides a platform for the face to face annual review.
Happy to chat further about team Announcer and the great things we do for our clients!
Have a great weekend.
02 9251 5558
Daniel, first of all, you really don't want to be refinancing every year, as you'll never own your home.
While you may get the latest 'good deal' your broker is the one making the money, as we get paid for each settlement.
What we prefer to do is each year or two, check with the lender if they're willing to decrease your rate. This costs you nothing, and saves up to $1,000 in refinancing costs, and to be honest, you can do this yourself with little fuss.
Banks really only start making money from your loan after 1-2 years, so after that time, (when they're actually making a profit from you) they're keen to keep you even at a reduced profit margin.
As a broker, this is easy for us to check & arrange for you.