James Kingscote and Mark Magill.

LAURA WILLIAMSON

Buying a house is the biggest purchase most of us will ever make, and one of the more daunting aspects of the process can be securing a mortgage.

Decisions range from which lender to go with, how to structure the borrowing and repayments, whether to go revolving or fixed, how long to fix for, and what insurance to get.  

Enter the mortgage broker. A mortgage broker is someone who acts as an intermediary between a buyer and a bank or other financial institution; not only can a broker help you secure a loan, he or she can help ensure you get the best deal possible, and save you a whole lot of head-scratching during the process.

To find out more, we caught up with Mark Magill and James Kingscote from Wanaka’s only local broker, Mike Pero Mortgages Queenstown and Wanaka, and came up with six reasons to give a mortgage broker a call.

1. All banks are different. As Mark explained, banks have differing policies, and they can vary greatly. "We try and find a bank that will do the deal for a particular person,” Mark said. For example, some banks might be less open to lending to self-employed individuals, of which there are a high number in Wanaka - a mortgage broker would be able to direct a self-employed buyer to the bank most likely to take her or him on.  

2. All people are different too. A mortgage broker will look at the specifics of an individual or couple’s situation and identify which lender is ideal for that particular client. All sort of factors can come into making the situation easier, or more difficult, for a buyer down the line, Mark said. Someone wanting to buy a section and then returning later for financing towards buying a house, for example, might be turned down - a good broker would know to take factors like this into account when bringing a buyer and lender together.

3. Price isn’t everything. It’s tempting for a buyer to fixate on the lender offering that looks like the best deal, such as the lowest rate for a fixed loan. But a mortgage broker can help you look at how to get the most competitive deal long-term, which might not mean nailing the cheapest rate up front, but could be more about taking out the peaks and troughs for a long-term net gain.

4. Sometimes you need to think outside the box. To fix or not to fix? And for how long? A mortgage broker knows to look at all sorts of things that might not cross a buyer’s mind. A couple with a one-year-old, for example, might want to fix for two years specifically because 20 hours of government-subsidised daycare kicks in at the age of three. Rates aside, fixing would keep payments predictable until the free daycare starts, making financial planning when only one parent is is working less stressful. Good point Mark, we never would have thought of that!

5. You don’t have to be there yet to get their help. Mark said if you don’t have the means to get yourself into the market just yet: a broker can help you formulate a plan, including through savings and taking advantage of government initiatives like the KiwiSaver HomeStart grants, to get into the property market more quickly.

6. You don’t pay, the banks do (how often do you hear that?). As a buyer, the majority of the time it won’t cost you a thing to work with a mortgage broker - it’s the lenders who pay brokers a commission. Are you smiling yet?

PHOTO: Supplied