For some migrants, part of feeling like you’ve settled, is when you buy your first home. As it is, this can be a difficult and daunting process without the advice and support of a professional mortgage broker. House prices are more expensive now than ever before so not making the right choices can also become very costly.
In recent years we have seen a large increase in new migrants to Australia, especially Melbourne and Sydney. A large percentage of mortgage brokers, including home loan experts in these states, have recognised the need and have moved to specialise in lending to those without Australian Citizenship.
Why use a mortgage broker?
In Australia, mortgage brokers are a preferred option than going directly to the bank. When you sit in front of a mortgage broker you are potentially sitting in front of all the banks and lending institutions whereas going to the bank, the banker will only give you a choice of the products offered by that bank. If you want a comparison you will need to visit multiple banks. With access to a panel of approximately 40 lenders and hundreds of products, using a mortgage broker effectively gives you more choice as well as the expertise of a specialist, all at no cost to you. Mortgage brokers are paid by the lender for doing the work that would otherwise be completed by the bank. It’s important to know that interest rates and fees are the same from a mortgage broker as they are from a bank directly. In some cases, even more competitive.
Which bank is right for me?
With some research, we’ll be able to find the right bank for you. There is no one bank that suits every new migrant but there are certainly ones that will work better than others, depending on how it’s used to save and move funds. Most banks request migrants to have a minimum deposit of 20% of the property value. They do not offer discounts unless asked and may not be what others are getting.
What options are available to me?
Home loans in Australia work quite differently to home loans overseas. In fact, you’ll find that they have more features including:
- Variable or fixed interest rates
- Basic, line of credit or offset loans
- Professional packages with larger discounts
- Interest only repayments for investors
- The ability to make extra repayments.
How can I get the most competitive rate?
The best way to get the most competitive interest rate is to ask for a key facts sheet from different lenders and compare them all. Better yet, work with a mortgage broker and have them identify which top 3 or 4 best match your needs and if possible, put in a special pricing request. You’ll find the best discounts aren’t advertised but through negotiation. Banks change this on a weekly basis due to new offers and changes in funding costs. It’s important to not only look at interest rates but more so much, how much it will cost you overall in fees.
Can I get a discount?
- You may be able to negotiate a lower rate, if your loan is over $250,000
- More lenders will compete for your loan, if you have a deposit of 20% or more of the property value
- Target banks that are aggressively trying to grow their market share