Bank vs. Broker - Home buyers play the winning hand
White picket fences, flower pots and fake lawn - is that enough to tempt you in? Perhaps a free breakfast complete with muffins and coffee? Recently, Westpac launched new 'Home Hunt' Centres in Sydney to encourage buyers in for a chat. They think more home buyers want to discuss mortgages with the experts. They also found out that the new generation of home buyers want more than a good interest rate.
Banks get a wake up call
Banks are starting to realise that with a proliferation of non-traditional mortgage lenders vying for business in a slow market, they will have to broaden their horizons to find potential customers. A free muffin and a newspaper with the latest real estate listings is just the beginning. Mortgage lenders are now expected to be available after hours and on weekends, as more and more non-traditional mortgage lenders try to make their services easier and more appealing than the banks. Extras like 'home hunt kits' and information and tips on how to find your ideal home are now part of the norm. So what are home mortgage borrowers asking for?
With so many products on the market, buyers now expect to save on a range of financial services when they deal with a bank. If they sign up for a mortgage, they want discounts on other services. Westpac's research shows that eighty-seven per cent of buyers now expect free transactions on their savings or cheque accounts and almost seventy per cent want a free credit card.
What Banks can offer
Many of these special deals are known as 'relationship packages' and are used as an incentive to lure existing customers, or encourage new buyers to make use of all the bank's facilities. Special deals you can look for include:
- waived transaction and account keeping fees
- a discount on home loan establishment fees
- discounts on home and contents insurance
- free financial needs analysis
- waived annual credit card fee
What Home Loan Brokers can offer
If you want to save time, reduce your leg work, understand all your options and make sure you find the best possible deal - a mortgage broker is the ideal solution. The best news is that you can get started without even leaving your house or office. For a comparison of services offered by reliable home loan brokers please visit the Home Loan Broker Reviews.
Banks are in a unique position to offer special deals on credit cards as they are currently the only institutions allowed to issue them. All other companies must co-brand their cards with a bank. Due to their deposit facilities the banks can also offer you attractive loan features like offset accounts. In this way you can offset the interest earned on your savings against the interest payable on your home loan account.
However, the banks’ strategy is to monopolise the services they offer the mortgage borrower. Home mortgages are easily the most lucrative high margin products for banks. Conversely, home loans are the most expensive service purchased by home owners. By achieving the monopoly of services to you, banks can hide their higher charges for home loans, while discounting other services.
Here is how you can play your mortgage brokers card
A home mortgage broker will negotiate, on your behalf, with the bank to get you the lowest cost home loan deal. Your personal mortgage broker will trade your mortgage needs between banks and non traditional mortgage fund providers to negotiate a great low cost deal on your behalf. The end result is that you receive a cheaper home mortgage.
The cost of a home mortgage can be many times greater than all the other bank services put together. So you need to seek the option and the facts on deciding what best suits you. With a mortgage broker you have the advantage of choice between retaining the benefits of bundled bank services or save money on your mortgage with a non traditional mortgage lending source.
You can gain a smarter outcome by speaking to a mortgage broker. Just relying on a bank to provide you with their offer may mask the high cost of their mortgage. Please select from a range of trusted mortgage brokers thoroughly researched. These reliable mortgage brokers will negotiate on your behalf and offer you real choice.