One of the biggest financial decisions that one can make in one’s life is getting a mortgage, and it is important that one gets it right.
The mortgage market is highly competitive and it is quite understandable if you are unsure what exactly is on offer. There are as many providers as there are products and rates.
It is generally a good idea to consult your bank in addition to a few independent mortgage advisors before you make a decision.
In this article, we take a look at whether you should get a mortgage advisor, how your bank could help, and where to get free advice.
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When Hiring a Mortgage Advisor is the Right Idea
Most bank and brokers provide decent advice when they recommend you a mortgage. By taking a look at your income, past debt repayment, and day-to-day spending, they will assess the level of mortgage repayment that you can afford.
Even though the banks and brokers offer advice that may seem right, you have the option to reject their advice and find a deal that is better based on your own research.
In its stead, you can hire a mortgage advisor, or an independent mortgage broker, to help you pick from a range of mortgage products that suit your needs.
A mortgage advisor is a specialist that has in-depth knowledge about the market. There are three different types of mortgage advisors.
One category of them is tied to specific lenders, another look at deals from a list of lenders, while yet another type scours the whole market for a wide range of products.
Even this last type, the ones that take a look at the “whole market” don’t necessarily cover everything. For instance, they may not be able to advise you on mortgages that are available only if you directly go to the lender or the bank.
However, all mortgage advisors have to offer you advice when they make a recommendation for the mortgage deal that is suited to your financial conditions. When you hire a mortgage advisor you invariably get a variety of services. A mortgage advisor –
- Checks your finances to ensure that you can afford the mortgage;
- Might provide you with exclusive deals that may otherwise not be available;
- Completes your paperwork for you so your application is taken care of faster;
- Help you take into account all the various features and the costs of the mortgage beyond the interest rate; and
- Recommends a mortgage that is ideal for you and tells you which ones you are more likely to get.
Some mortgage advisors will charge you based on their services as well as the value of your mortgage. Others will have an up-front fee that you will pay for their services.
They will also have to tell you if their services are paid or for free. Once the mortgage advisor makes a recommendation, they have to provide a mortgage illustration document.
Risks of Not Getting Mortgage Advice
When you take mortgage advice, instead of doing your own research, you have the right to make a complaint if the mortgage turns out to be mis-sold or unsuitable for you later on.
When you don’t take mortgage advice, you have to take full responsibility for your mortgage decision and bear with it.
When mortgage advice is not taken, it is possible that you can end up with an incorrect or erroneous mortgage for your condition which can be a very costly blunder in the long run.
It is also possible that you may be rejected by your lender because of the miscomprehension of the restrictions or the circumstances of the mortgage.
Getting mortgage advice is one of the best decisions that you will make at the time of finalizing a mortgage. Not only does it make the process easier, but it also ensures that you get the best possible deal based on your financial situation.
Though banks and brokers do provide their own advice for free, their advice may not necessarily be always in your best interest. When you hire a mortgage advisor, you pay them specifically to look into your situation so they can provide you with the best possible deal in the market.