In today’s show, together with Andrew Mirams from Intuitive Finance, we answer our reader question: “Is it really worth my while using a broker? I’ve heard you talk about using brokers, but I have a good relationship with my bank manager. Surely that will be enough for me. Do brokers actually get me a better deal?”
Kevin: I received an email from Joseph that was quite interesting. I want to put the question to Andrew Mirams from Intuitive Finance. He joins us.
Good day, Andrew.
Andrew: Good day, Kevin. How are you?
Kevin: Good, mate. I’ve sent this through to you, but I’ll just quickly read it out. “Is it really worth my while using a broker? I’ve heard you talk about using brokers, but I have a good relationship with my bank manager. Surely that will be enough for me. Do brokers actually get me a better deal?”
There you go. I think I know what you’re going to say, but let’s have it anyway.
Andrew: It’s funny, you didn’t ring the bank manager for that advice. Thanks, Joseph, for your question. I think it is a really good question. The thing with anything in relation to this is getting experts in their fields to surround you. That’s the real key. Whether it be a mortgage broker or an accountant, it doesn’t really matter. Get experts in their fields to surround you if you’re trying to build a property portfolio or whatever it is that you’re doing.
Why should you use a mortgage broker? A bank manager’s job, for example, is to manage the bank, look after the cash, look after deposits, look after accounts as well as the loans and the lending side – anything ranging from a $5000 personal loan for a car up to a commercial loan. They’re probably what we would call generalists, whereas mortgage brokers specifically work in just the field of the asset finance, actually trying to get home and investment loans.
I think when you have a specialist rather than a generalist working for you, you’ll always get a far better outcome. That’s the first thing, as a comparison. The online market is coming on leaps and bounds, and there are all sorts of online specials out there. But when you sign on for just the low rate, do you really know what you’re getting? A mortgage broker can give you that advice.
Kevin: Let me ask you, if I may, in your normal day-to-day workings, how many lenders do you have access to?
Andrew: We have access to just over 30 lenders and well in excess of 500 products. Again, your bank manager, if they work for ABC or XYZ bank, they’re going to have just their product range, and they’re not going to be able to do all things for all people. That’s the other thing. What one bank may or may not do, we can find another one that will certainly be able to assist clients.
Kevin: Let me ask you this other question, too, that’s been asked of me from time to time about brokers. How do I know that the broker is actually giving me something that’s best for me, not just pushing me to something that’s going to give him a higher income?
Andrew: Yes, because brokers traditionally get paid a commission from the lenders. Every broker by law has to disclose what their commission is, and we openly advocate clients asking us why we’ve recommended that structural price or that lender to them. I have no problems advocating, and any decent broker won’t have any problems in disclosing the whys, the hows, and the comparisons in how a broker got to that decision.
The other thing, like I was saying before, Kevin, is we’re the experts in our field. We have access to the best packages, we can analyze the best prices, we can get access to funds, but also experts in our field – and I specifically work closely with investors and things like that – means we know where the best structures are, and we know how to set clients up to help them buy an investment property, or buy their second or third, or grow their portfolio, and try to grow their wealth through property.
Kevin: Andrew, does it depend on the person as to where you’ll put them, or is it more about what they’re looking at buying? In other words, I might be a homeowner but I’m also an investor; will my home loan have different benefits to it over the investor loan?
Andrew: Yes, it can. You certainly want to make sure that you’re trying to repay your home loan as quick as you can, because it’s not giving you a tax advantage, versus an investment loan that gives you a tax advantage, where there’s no need to. Having your offset account attached to your home loan and not your investment loan is obviously a major priority, and just little things like that.
There are specialists in all different areas. There are brokers – like in any profession – who are both really good at what they and are so-so at what they do, so finding the right broker within a mortgage broker also can be an effort. But again, word of mouth and networks are great ways to start.
Kevin: This is the man we recommend, Andrew Mirams, and you can contact him through our website, of course, RealEstateTalk.com.au. There is a button there, and, in fact, Andrew has his own featured channel where he puts a lot of his audios and videos, as well.
Andrew, I want to say thanks for your time and support. It’s always great talking to you, mate. Thank you.
Andrew: My pleasure, Kevin. Have a great day.