How do I know I am getting a good deal from my lender? Jessica Arabia, Finance Prospects

With so many products offered by various lenders, it can be quite perplexing trying to figure out whether or not you have scored yourself a good deal on your home loan.

Doing your research and comparing what is out there in the market is one of the most obvious ways to find out whether you’re sitting on a good deal, it can be a time consuming practice and an overwhelming experience for those without specialist knowledge of the mortgage sector.

“It’s good to shop around, and yes you can use comparison websites, but because lenders call like products different names, it can get very difficult comparing apples with apples. Brokers understand the special names and pricing, so it is worthwhile working with one as not only will it save you time but you’ll also get a well-rounded understanding of the advantages of each product.

That understanding of each product’s pros and cons is essential, because the best deal isn’t necessarily just the one with the lowest interest rate. It ultimately comes down to finding a loan that suits your plans - whether those plans are to pay the loan off as quickly as possible, to use it to fund renovations or investment down the track, or to pay the lowest total interest and fees over the life of a loan – and to finding a lender that will provide that loan at the level of finance required.

Imagine you want to buy your dream home. Now, different lenders will lend varying amounts based upon the same criteria. Therefore, that could mean that the lender with the sharpest rate may lend $200,000 less than the one with a slightly higher rate. If you really want that property, you are going to have to go with the one with the higher rate, which may only make a few thousand dollars difference a year in interest repayments.

To find out if you are getting a good deal from your lender speak to the team at Finance Prospects today on 8344 9933.