Worth Engaging a Mortgage Broker in 2024? (QLD)

beyondtool on 14/05/2024 - 10:30
Last edited 14/05/2024 - 10:32

Fixed rate is rolling off in a few weeks and St George have refused to negotiate below 6.18% variable with a $395/year package fee. We are looking at a $500K refinance and considering Greater with 6% ($3000 cash back) or Unloan 6% (with reducing rate).

My question: Is it worth engaging a mortgage broker in 2024 to get a better deal? I've seen many comments that suggest a broker can't do much better - and may attract other 'hidden' costs. I have read that banks are apparently stretched thin and don't have much wiggle room with rates at the moment. Open to any advice on how to negotiate a better deal.

Poll Options Sat, 01/06/2024 - 00:00

  • 9
    broker won't make much difference
  • 44
    definitely get a broker
  • 2
    There are better deals out there no broker required
  • 1
    A broker can negotiate better loan features (offset etc.).
  • 2
    Ride it out, rate drops are coming soon
Financial Home Loan

Comments

  • Drakesy on 14/05/2024 - 10:34
    +14

    What have you got to lose?

    Brokers get access to better rates than we can, the commission is embedded into the final mortgage rate so really it's all hidden and at the end of the day you won't be worse off. Unless the broker is on a kickback in which case shop around. They'll also indicate your borrowing capacity better than any off the shelf borrowing capacity calculator.

    Bit of a joke though how in this day and age where you literally can apply for a loan online with zero help and that brokers still have access to lower rates than anyone else.

    • freefall101 on 14/05/2024 - 11:35
      +2

      This, there's no commitment to use the broker, it's a free way of talking through the options.

      I went to one who found great rates but not a rate for the bank I wanted. So I didn't use them to sign up a loan in the end and all I lost was an hour of my time.

  • MrThing on 14/05/2024 - 11:25
    +4

    timely homeloans 5.94% and you dont even need a broker, 100% offset and its an ADI

    https://tiimelyhome.com.au/

    also a broker isnt going to make much difference below 5.94% rate I listed above, your loan value isn't very large

    • soan papdi on 14/05/2024 - 14:09

      This lender is always overlooked. $10/mo for offset is also a very good deal. My beef is the ADI i.e. Adelaide Bank (not Bendigo Bank), they don't support Osko and so all bank transfers are overnight. The net banking interface is also ancient but it works, so there's that.

      • MrThing on 14/05/2024 - 15:00

        I have a loan with timely (formerly tictoc) and yes there website is clunky as.f, but the rates sharp and 100% offset for $10 rather than 0.1% as some banks do is awesome.

      • beyondtool on 14/05/2024 - 17:28

        The lack of Osko is a bit of a deal breaker. Especially in 2024.

        • soan papdi on 14/05/2024 - 17:32

          Yeah and no PayID either. But it’s not our active transaction account, so it’s acceptable.

  • montorola on 14/05/2024 - 11:49

    I was of the opinion that if you do your homework you should be able to get a better rate than a broker?

    Why would/should the bank pay a middleman if you can go and negotiate the rates better?

    • redfox1200 on 14/05/2024 - 13:45
      +2

      why would a bank care whether you do your homework. maybe your parents would care.

  • Some Human on 14/05/2024 - 11:52
    +2

    I didn't find any value in using one. They pretty much just pointed at the bank I was looking at in the first place. They also required a lot more information than if I had just gone to the bank directly.
    But that's just my experience.

  • AngoraFish on 14/05/2024 - 12:01
    +6

    There is no dark web of hidden broker deals, secret back room priority phone numbers, mates rates, and guys who know a guy. If there was it would be in breach of all sorts of financial regulations.

    Also, you still have to fill in the same paperwork and answer the same dumb bank questions regardless of whether you use a broker or do it yourself.

    The main service that brokers offer is their mortgage database, which might on paper have "500 different mortgages", however in practice 99% of those will just be more expensive versions of the same thing that can be instantly eliminated by any quick scan of a mortgage comparison website.

    If you're lucky you might be able to save an extra 0.05% in interest because the database includes some virtual building society working out of Geraldton and ultimately owned by a shell company in the Cayman Islands, but is that really the kind of company that you want to do business with?

    Brokers also serve as middle men in forwarding questions and passing back paperwork, which in my experience is a total pain in the arse. It's much quicker and easier to just deal directly with the bank, and you're less likely to get into the inevitable Chinese whispers moments where the bank has a question about your financial circumstances that can't be answered in a couple of quick sentences.

    Brokers do not have any personal incentive to get you the best deal, their only incentive is to give you the impression that they're offering you the best deal so that you use them and not anyone else, or do it yourself. This is why you will get so many people in threads like this singing their praises. They've bought the hype, not because they've got any objective basis for making a comparison - most people who use brokers, in my experience, will if pushed admit that the rate they got was the same one they saw advertised earlier. In practice, all that brokers sell to most people is feels.

    Brokers don't get any extra commission by saving you an extra .01%. Brokers get commission by getting you to churn to them and then keeping you with them as long as humanly possible while they collect residual commission in the background for no additional effort.

  • Ocker on 14/05/2024 - 12:06

    You will never know the answer until you try a broker.

  • jv on 14/05/2024 - 12:45
    +4

    Worth Engaging a Mortgage Broker

    Depends if they have a dowry…

  • star-ggg on 14/05/2024 - 12:57

    If you have good serviceability then go with the cheaper online only lenders or banks. The small lenders don't farm out their work to brokers or give such small commissions brokers would never "recommend" them. If you are pushing serviceability and have to go with a major bank then you can get the same rate and cashback offers as going directly with the bank but get a cut of the commission from a broker as well.

  • localhost on 14/05/2024 - 14:25

    Just don't engage those guys - https://www.smh.com.au/technology/mortgage-lender-suffers-ha…

    Mortgage lender suffers hack, credit card details published on dark web….

  • bitesized on 14/05/2024 - 14:43
    -4

    What's your LVR? If 70% or below, one of the majors is offering 6.04% with broker pricing escalation on your behalf. Or, another major is offering 6.17% with a $2k cashback. And there's also a lender with a 5.98% rate and $3k cashback.

    But, seeing how so many non-brokers in the comments are the real experts, I'll leave them to tell you which banks have the best offers for you.

    • beyondtool on 14/05/2024 - 16:59
      +2

      LVR is less than 50%

      • bitesized on 14/05/2024 - 17:13

        Great, then well worth your time to speak to a broker. Very many helpful ones on this site who can access the rates I mentioned above, or even better.

        I checked them all against the spreadsheet Tomclancy posted below, and while it assists to get an overview, it doesn't list the rates per my comment.

  • apple2016 on 14/05/2024 - 14:45
    +1

    I have read that banks are apparently stretched thin and don't have much wiggle room with rates at the moment.

    For $500,000 at 6% interest over 20 years , the bank earns approx $359,718 in interest! You think they dont have wiggle room???

    • MrThing on 14/05/2024 - 15:05

      it needs to be re-written

      I have read that banks are slaves to their shareholders and must deliver growth every single damn year and if they give homeowners a break on their mortgage then the shareholders will vote down their remuneration report at the next AGM and then the highly paid CEO and their buddies will be looking for alternate work and will only be able to afford to purchase 10 mortgagee sale investment properties and 1 Ferrari this year apparently stretched thin and don't have much wiggle room with rates at the moment

    • beyondtool on 14/05/2024 - 17:02

      An article that discusses the supposed bank 'squeeze' https://www.reuters.com/business/finance/australia-banks-fac…

      • apple2016 on 17/05/2024 - 15:02

        Thats more related if you want to invest in bank's shares. not for home loans….

  • tomclancy on 14/05/2024 - 15:26
    +5

    An OzBargainer called autonomate has pulled together this amazing spreadsheet CSV of Every Home Loan Mortgage Rate + Cashback in Australia. And then another OzBargainer called lucisvivae took that spreadsheet and made it customisable to your personal circumstances. They are the real MVPs

    • beyondtool on 14/05/2024 - 17:05

      Thanks Tom, I did find it a bit out of date (already) and was missing a few of the fees/charges that make a comparison a bit more difficult. Hence my question as to whether a broker can do any better.

      • apple2016 on 17/05/2024 - 14:59

        If you are asking this question , then brokers can always do better! but will they is another topic.
        Unless you personally know higher up in the lending division in a bank who is giving you mates rates… mortgage brokers exist for a reason.

  • cyrax83 on 14/05/2024 - 17:11

    Just finished fixed term with St George and with a broker. Best we got with St George is 6.38% on investment and 6.19% on owner home. Not sure where to go from here Broker said its very competitive pricing.

    • AngoraFish on 14/05/2024 - 22:05

      Well the broker would, wouldn't they. With 80% LVR you can get less than that at ING https://www.ing.com.au/rates-and-fees/home-loan-rates.html , amongst other banks mentioned elsewhere in this thread.

    • tomclancy on 14/05/2024 - 23:03
      +1

      Time to ditch your broker.

      Those rates are not competitive. For a super easy switch go to CBA's digital arm called Unloan —> https://www.unloan.com.au/home-loan. Owner occupied 5.99% and investment 6.29%.

      Or for a slower service, but gets there in the end, go with Greater Bank —> https://www.greater.com.au/personal/loans/home-loans. Owner occupied 5.99% and investment 6.14%. Plus $2,000 or $3,000 cashback. No brainer

      Unloan and Greater don't pay commissions to mortgage brokers so brokers won't recommend them

      • cyrax83 on 15/05/2024 - 13:11
        +1

        Thank you I'll definitely look into this

  • jrvb42 on 15/05/2024 - 08:15

    Eh? The banks are stretched thin? Where did you read that?
    Here's something worthwhile to read - look at any bank's profit and loss statement - or just google a bank's most recent profit.
    They aren't gouging like Colesworth, but they and their shareholders aren't in any pain, let me tell you.
    Banks, supermarkets and airlines are just a few of the business species protected by the Australian Government, and you can't change my mind.

  • Gesiet on 15/05/2024 - 08:38

    Absolutely worth checking. Often they can find a great deal, but occasionally they can’t beat the bank. Ours (also in Qld) is very honest and will tell us if we are better staying with the bank / going elsewhere.

  • SlickMick on 15/05/2024 - 09:08
    +2

    I used a broker once. But I could find better deals myself, so never bothered again.
    The cheap online loans tend to deal direct with customers, so brokers don't have access to the cheapest loans. That's my experience. YMMV

  • beyondtool on 15/05/2024 - 11:38
    +1

    So LoanBase, a broker I have used before just got back to me but are not offering anything competitive.

    1. Bank of China 5.98% + $3288 cash back
    2. Heritage 5.99%
    3. ME bank 6.17% + 2k cash back

    Not going with Bank of China or ME bank either due to ethics.

  • tonka on 15/05/2024 - 12:08

    Get a broker, but don't trust them and if they are at all abrasive ditch them. They will want you on the product that gets them the most commission, not the best product for yourself.

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