Expert Mortgage Advice and Tips for Navigating the Mortgage Market
Are you ready to take the next step towards homeownership or financial stability and need mortgage advice? Understanding the mortgage process and all the lender and loan options available to you can be daunting, but with the right knowledge and guidance, you can make informed decisions and achieve your goals. In this online guide, we aim to help you understand some key areas of the process and get you started on your mortgage journey. For personalised advice from a professional mortgage broker, you can book a free consultation with us to talk through your finance options and how we can help.
Understanding the Mortgage Market – Quick Guide
Types of Mortgages
There are a range of mortgage types available depending on your circumstances. These can include fixed-rate, variable-rate, interest-only and line-of-credit mortgages. There are also bridging loans for when you are buying and selling and need finance to “bridge the gap”.
Key Terms
Interest rates
The cost of borrowing money, expressed as a percentage of the principal amount.
Lender
An institution that provides loans. There are a range of types of lenders from the “Big 4” banks to smaller independent lenders. Each has different loan products, lending requirements and policies and a mortgage broker can help you determine which options are right for your loan needs.
Loan-to-value ratio (LVR)
The ratio of the loan amount remaining to be paid to the property’s market value.
Loan repayments
Regular payments are made to repay the principal and interest on a loan.
Fees
Charges associated with a loan, such as application fees, establishment fees and annual account fees. The level of fees required depend heavily on the lender and the loan product. For a comprehensive overview of fee requirements, a mortgage broker will ensure you know all your options while making a suitable recommendation.
Deposit
A portion of the purchase price is paid upfront when buying a property. Many lenders prefer a deposit of at least 20% of the purchase price, however, a smaller deposit is possible for many of the lending options a mortgage broker has access to in their available panel of lenders.
Role of Lenders and Brokers
Lenders are an institution that lends money and requires repayment with interest. Although you can directly engage a lender for your finance, they are not legally bound to work in your best interest and will only provide you advice on their own products. A mortgage broker, on the other hand, can be a trusted mortgage advisor in the home loan process. A broker can access thousands of loan options and match the right ones to your circumstances. They also have established relationships with lenders so they can negotiate on your behalf, often for a better deal.
Tips for Finding the Right Mortgage
- Assess Your Financial Situation: Evaluate your income, expenses and savings to determine your borrowing capacity. Use our free online calculator!
- Set Clear goals: Define your short-term and long-term financial objectives, whether it’s buying a home, refinancing or investing.
- Consider Your Lifestyle: Think about your current and future lifestyle needs, such as family growth or career changes, to choose a mortgage that aligns with your plans.
- Shop Around: Compare interest rates, fees and terms from multiple lenders to find the best deal.
- Seek Professional Advice: A mortgage advisor can help you navigate the complexities of the mortgage market and tailor your loan to your specific needs.
Common Mortgage Mistakes to Avoid
- Overborrowing: Avoid taking on a loan that’s too large, as it can put you at risk of financial hardship. A lender will not allow you to go over a certain threshold, but a mortgage broker can help you understand more about how different lending amounts will play out for you into the future to help you make an informed decision.
- Ignoring Fees: Be aware of upfront and ongoing fees associated with your mortgage.
- Locking Yourself In: Understand exactly how fixed interest rate periods and variable interest rates will mean to your loan with the help of expert mortgage advisors before you lock yourself into an advertised rate.
- Failing to Review Your Loan Regularly: Periodically review your mortgage to ensure it’s still meeting your needs and consider refinancing if better options become available. At North Brisbane Home Loans we offer free home loan health checks to ensure you aren’t paying too much.
The Role of a Mortgage Advisor
At North Brisbane Home Loans, our experienced mortgage advisors are dedicated to helping you find the right home loan. We offer personalised advice, negotiate with lenders on your behalf and provide ongoing support throughout the entire loan process.
Ready to start your mortgage journey? Contact North Brisbane Home Loans today to schedule a consultation with one of our experienced mortgage brokers.
Patrick Cranshaw, a Certified Mortgage Professional for over 21 years, founded North Brisbane Home Loans in 2002. His career began with ANZ Bank in New Zealand, where he progressed over 16 years to a Business Banking role in Virginia. After moving to Brisbane in 2000, Patrick led the QLD market for a home loan agency, helped set up the REMAX Real Estate Finance division, and practiced as a broker.
