Mortgage Broker vs. Bank vs. Builder Finance—Which One Actually Works for You?

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Hello and welcome back to another episode of the podcast. Today I am joined by Tanya again. And we’re going to discuss the pros and cons of using a finance broker versus going to a bank. So Tanya, let’s kick it off. I have a lot of pros, by the way, why you, I mean, not being biased or anything, cause I am a finance broker, but there are actually so many reasons why even myself, I used a broker when I built instead of.

Going directly to my bank. Yep. I also use a finance broker. Why wouldn’t you? It’s free. Yeah. Start off by telling us some of the pros of going to a finance broker. So first one would be we have access to so many different banks and lenders. So we’ll have access to the big banks, smaller banks and credit unions and, and just small lenders that you might have not even heard of that might specialize in certain things that might be useful for you.

Like if you’ve got bad credit. There’s a lender that we would have under our panel that would help you. If you have a short time in employment, there’s a lender that we’ll have under our panel to help you. So we just have so many different options and products that are, can be suited for your situation.

Opposed to a bank where they would only be selling you their products and tell you about their policy and it might not be a right fit for you. So you might be turned away from that. That lender not knowing that there’s 30 other options available if you had of used a finance broker. Yeah, or you got to do the running around yourself and find all 30 options, which also who has the time for that?

Who has the time and why would you want multiple credit inquiries on your name? True. It affects your score by doing that. So definitely just look at using a finance broker because we do all the groundwork for you to begin with before we will even look at lodging your application to a lender. So that’s a pro.

Cool. Um, any other pros? There are many. There are many. We have the expertise and guidance in that particular bank because we have to learn that bank’s policies, how they might look at your employment, what income they’ll take into consideration, how they look at your consistency of your work. So we are able to see all the different lenders and what you’re able to borrow with that particular lender.

One bank might only lend you 400, 000. So you think, Oh, that’s all I can borrow, but we have another bank that can lend you 600, 000 due to their policy and how they look at your income and debts. Um, the borrowing might be a lot better with them. So you just have more options if you look into all the different lenders, instead of just going directly to your bank and just accepting their answer and leaving it at that.

Another thing is saving so much time. So because we’re doing all of the work for you, it saves you time on having to do your own research on top of doing your own research for your house and land and trying to find the right builder. Also use building broker for that. That’s going to save you a lot of time and also do the groundwork for you.

Yes. So I guess there’s pros and cons that also. Match what you do with saving clients time, giving professional guidance. Um, also we have a negotiation power, which is what you would have to with your builders. So it is quite similar. Now that I think about it, very similar. So we can help you get like an annual fee waived.

We can help, um, explain your circumstances to the bank to get it. To be approved Whereas if you just were to go directly to the bank and use their home loan specialist Most of the time they won’t even bother to try get your your application across the line because they’re getting paid a salary so they don’t really care if your loan gets approved or declined whereas Finance brokers, we only get paid if your loan gets approved.

So we’re doing everything we can to make sure that we’re using our time wisely and trying to get your loan approved. Yep. You’re looking after and advocating for the client, which is also exactly the same as what I do and negotiating. Yep. Yep. Lots of similar crossovers. Okay. So seeing as our. Our pros and cons are so similar.

What would be your pros and cons as a building broker, opposed to like a client going directly to a builder and doing it all on their own? Yes. It’s first time, like you’ve got to go around to display villages. Also who wants to spend their weekend in display villages, display villages, uh, a whole different beast in itself.

And I think I’ve got another episode for that, but you know, you’re walking around into a display village. In a, like a salesman’s area or woman salesman or woman, and everyone’s literally fighting over the same lead client that they’re all going to get. So do your display homes are filled with, you know, 150 to 200, 000 worth of extras.

So it’s not a real example of what you’re actually going to get saving you. Money by avoiding like the common pitfalls or mistakes and giving you that professional guidance, like you said, helping educating and supporting clients through the process. We really hold your hand and coddle you all the way from the start to get your keys, which most.

Sales consultants or builders, they don’t do that. You get signed up, you get a block of land, you sign your prelim agreement, you get thrown in the system. Then you get passed through admin, you get passed to the client liaison, and then you get passed here and then you get passed to the site supervisor.

So the whole experience is so different when you look at like. Builder versus broker, and also like our experience through our brand and what we provide our clients is also very different and unique to what other building brokers can provide to and stress. You’re saving so much stress. Like you don’t have to worry about it.

We’re doing all the work for you and same thing. We get paid commission flat fee through the builder. So we will do everything that we can with your best interest at heart and keeping in mind, you know, Market timeframes, quality, and price. We’re not selling you one product. We have your best interest at heart to make sure you get the best house and the best land and the best package your finances looked after.

And we’re that middle person that kind of ties everything together. You can come ask questions. I’m unsure about this. I’m having a mental breakdown about this emotional. Support a marriage counselor, literally everything. So there’s so many pros. I built my house through a building broker and it’s the way I did it and how I got into the industry.

So I’m obviously slightly biased on using a building broker, but I went through the process like that myself. I attempted to do it going through a builder direct, and it’s just so different. Very true. I did go through a builder direct because I knew the building reps, so it was different. But if I was to build again, I don’t trust.

Yeah, not that I don’t, I mean building reps are great and all. Yeah, but there’s some very good ones out there. There’s just also some very Not great ones out there that it’s very money It’s very hit and miss and you’re playing a gamble like roll the dice and see how it works out Which to me if you’re gambling half million dollars, which is way house land packages away more than half a mil Now you’re gambling your life savings and that amount of money to see what happens who you get if the builders gonna work out It’s a big gamble.

Yeah, so that’s why you probably need brokers on your site to actually help you. Absolutely. Through the process, seeing as we have done this before from our own experience and learned from our own mistakes, but also because yeah, this is our job and we see things go wrong. Yeah. We don’t want that. You know, every day.

Yeah. We don’t want our clients to go through. Um, the cons of, of it all, cause it’s really hard to get out once you’re in the bad deep end. Yep. Once you’re in it, you’re in it. Yes. Cool. Well, thank you so much for joining us on this episode.

Thank you so much for tuning in to the Home Building Like a Boss podcast. I hope you enjoyed today’s episode and learned something new. Remember, you’ve got this and I’ve got your back. Until next time, stay inspired, stay informed, and stay confident on your building. I can’t wait to chat with you on the next episode.

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