For most of us, getting a home loan is likely to be the biggest loan we will ever get in our lives! In fact, it can take up to 30 years to repay. A mortgage consumes a large chunk of your weekly / fortnightly / monthly budget and if you get into financial difficulty and are unable to meet your repayments, then you could potentially have your home sold by the bank to repay any outstanding amounts owing on the mortgage.
The costs involved with selling a house include lawyers’ fees, bank fees and penalty interest and real estate agent commissions. These costs eat into any equity that you have built up in the house, or if you are in your early stages of your home loan, then this eats into the initial deposit that you saved up for all those years. And to add to that - if the property market is going through a downturn and the values of the property have fallen, you could be in a position of no house, no deposit for a new house, and money still owing to the bank!
If you were to add up how much a home loan will cost you in interest over the life of the mortgage, you could find that this will cost you the equivalent of another house!
A prudent person would therefore shop around and make sure they get the very best deal on a mortgage - meaning both the lowest interest rate, and the most flexibility for their mortgage - so that they can repay the debt as quickly as possible and save as much interest as possible.
Shopping around banks and loan providers is very time consuming, and can also be very confusing! If you are like most other people and have a full time day job, and children, who has time to go to the banks during the day to figure out the best mortgage deal? If it takes you 1.5-2 hours in an appointment with a banker, factor in travel time, finding a car park etc. and then multiply that time by how many banks there are to approach, then a full time worker could see themselves taking a few days annual leave just to get a home loan approved through a bank! I would much rather spend that time with my kids, or fishing or both!
Also by the time you've come home from work, you’ve gathered the information to discuss with your partner, you’ve had dinner, washed up, done kids' homework with them and finally put them to bed... you’d be exhausted and just want to sit down with a cuppa and watch some telly right?
But you can't be tired - as this is a really important decision to make. Should you get a floating home loan rate or a fixed? How will that loan structure fit in with the other things you want to do in the future? Do you want rewards points on your home loan or do you want to save interest costs? What is going to happen once the fixed interest rate finishes, where will interest rates be? Do you have a full 20% cash deposit and if you don't, what options are there for you to still get a mortgage?
By using a mortgage broker, you only need to deal with one person - not have appointments with three, four, five...
A mortgage broker is knowledgeable about the industry, is kept informed of changes in the property market and the finance market, and, most of all...
Can work with you and do the 'shopping around' for you - to ensure you get the very best deal for your situation, and your goals. A mortgage broker is likely to know the most attractive offers available and see through all the extra fluff and terms and conditions that surround these enticers.
Mortgage brokers are independent as far as they deal with multiple banks and lenders, so if a deal doesn’t work with one bank, it may work with another.
Using a mortgage broker is usually a free service to customers in New Zealand as the brokers are paid brokerage / commission from the finance institution you go decide to go with.
When you use a mortgage broker, you are ultimately a truly valued customer, not just a number - because mortgage brokers are not on salary, they are self-employed and only get paid once you get a home loan. So chances are very high that when you ring a broker they will answer the phone or get back to you really fast!
A plug for WealthHealth now...
Why use US as opposed to another Mortgage Broker?
Not only will we be able to provide you with a professional service for all your Home Loan needs, but as a certified Financial Planner I can provide you with advice on the other areas of your Personal Finances such as Life and Income Protection Insurance, Retirement Planning, and Kiwisaver and some guidance on Ownership Structures and Estate Planning.
Additionally I will wrap all of this up into a Personalised Financial Plan for you. That’s a document that sets out your life goals, and provides a written road map / strategy to help you achieve those goals. I’ll work with you to help you identify and minimise / remove any road blocks that may be in the path of you achieving your financial goals.
That means you only need to deal with one person, someone who is independent (uses a variety of financial organisations to get the best deal for your situation). I’ll work with you over your life’s journey and provide advice and guidance along the way.
I want to be the first person you call for anything to do with your personal finances and I can’t wait to hear from you and start working with you to achieve your financial success.