Mortgage brokers know the interest rates and application criteria for different lenders, and can negotiate on your behalf, and can help you put a loan application together. They may be able to help you find a loan if a bank says no, and may be able to get a better deal than if you went direct.
While using a mortgage broker seems like it would save you money because they have access to many lenders and programmes, when working with a Bank, that loan officer only has access to their own mortgage programmes and mortgage rates. A mortgage broker acts as a middleman between you and potential lenders. The broker's job is to work on your behalf with several banks to find mortgage lenders with competitive interest rates that best fit your needs.
LVR lending restrictions are tighter for loans secured by investment property, in response to the growing housing market risks in that area. High-LVR loans in this category are those loans that are more than 80% of the property's value (20% deposit). Banks will apply a low equity margin to the standard interest rate, but not all banks are created equal. There are very differing offers in the market and Rethink want to stress the importance of using a mortgage broker, as the difference between lenders can be massive as the below example shows:
Some examples are:
Based on 90% LVR (10% deposit) – todays rates in the market
Bank 1 = 4.45% fixed for 1 year interest rate with a cash contribution
Bank 2 = 5.20% fixed for 1 year interest rate with no cash contribution
Bank 3 = 5.69% fixed for 1 year interest rate with no cash contribution
Going by these examples, a mortgage broker offers a wide range of mortgage loans from a number of different lenders. The greater the broker's experience and network, the better your opportunity to obtain the loan product and the interest rate that best suits your needs, so for more information on home loan calculators, mortgage brokers and refinancing mortgages NZ please go to https://rethinkgroup.co.nz .