Disclaimer:
The information on this website is for general guidance only and does not constitute financial or investment advice. Always do your own research and seek personalised advice from a qualified financial adviser or mortgage adviser before making financial decisions. All investments carry risk and past performance is not indicative of future results.
Key Takeaways
- Engage early to shape your budget and plan.
- Advisers can compare lenders and criteria on their panel.
- They may help with pre-approval, loan structure and settlement tasks.
- Check registration, FAP licensing, scope, fees and commissions before committing.
- Adviser support can be useful for complex or non-standard cases.
In short, it can help to speak with a mortgage adviser early in your home-buying journey, before you rely on a budget or start making offers.
Embarking on the exciting journey of homeownership is a significant milestone in anyone's life. Whether you're a first-time buyer or a seasoned homeowner, the complexities of the real estate market can be overwhelming. One crucial decision that often arises during this process is whether or not to engage the services of a mortgage adviser, and when.
Why Use the Services of a Mortgage Broker?
Many mortgage brokers are paid by lender commission rather than a direct borrower fee, but you should still ask whether any fee applies and what commission they receive. Lenders use different criteria, and a mortgage adviser may be able to compare lenders on their panel and help prepare a home-loan or pre-approval application.
It is still worth comparing lenders, rates, fees, cashback conditions, repayment flexibility and break-fee risk before accepting an offer. A mortgage adviser can help explain loan structures such as fixed, floating, split, offset or revolving-credit options, but the right structure depends on your budget, goals and risk tolerance.
TIP: If you decide to use a mortgage adviser, check their registration, experience, scope and the licence of the Financial Advice Provider they work under. The Financial Service Providers Register can show licensed Financial Advice Providers and the financial advisers engaged by them.
Note: Ask how the adviser is paid, which lenders they work with, which they do not work with, and how your personal information will be used and protected during the application process.
The Four Stages Where a Mortgage Adviser Helps
Stage 1: Early Planning
If you're just starting to think about buying a home, a mortgage adviser can help you:
- Understand your financial situation
- Assess your eligibility for a mortgage
- Provide insights into how much you can afford
- Understand what your hurdles are
They may also explain first-home-buyer support options within their scope, such as KiwiSaver first-home withdrawal and low-deposit lending options where available. First Home Loan eligibility and final approval still depend on Kāinga Ora criteria and the participating lender.
Stage 2: Pre-Approval Stage
Before you start serious house hunting, getting pre-approved can help you understand what a lender may be prepared to lend. A mortgage adviser can guide you through documentation, explain mortgage options, and help keep the application moving.
A mortgage adviser can act as a go-between for you and lenders on their panel, from identifying your needs to managing application questions. Ask what services are included and where you may still need lender, legal, insurance or tax advice.
Learn More: Pre-Approvals vs Live Deals: What First Home Buyers Need to Know
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Stage 3: Confirming a Mortgage Structure
Mortgage advisers usually work with a lender panel. They can help compare interest rates, fees, terms and conditions across that panel, while you can also compare direct-bank options yourself.
Mortgages come in various types, including fixed, floating, split, interest-only, offset and revolving-credit options. A mortgage adviser can explain how these work and why a recommendation may or may not fit your circumstances.
Navigating Special Circumstances:
If you have a non-standard situation, such as self-employment, irregular income, credit-history issues or a complex property, a mortgage adviser may help identify lender criteria that could fit. Approval and loan terms still depend on the lender assessment.
Stage 4: Settlement
During the settlement phase, a mortgage adviser may help coordinate the loan side of the handover, including:
- Loan documentation is issued and returned
- Lender conditions are checked with the lender and your lawyer or conveyancer
- Final loan steps are tracked before settlement
- Any lender questions are followed up promptly
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Frequently Asked Questions
Need personalised guidance?
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Have a question about this?
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