Whats the difference between using a Broker or going direct to a bank

[donkey]

As the title suggests, if I want to re-finance the loan on my I.P what is the difference between using the services of a finance broker and going direct to the bank.

Are there hidden fee's or commissions using a broker?

Over 10 yrs ago, I always went direct to the bank for my I.P's.

Which option is going to be more cost effective to me over the long term?

 

[alexlee]

As the title suggests, if I want to re-finance the loan on my I.P what is the difference between using the services of a finance broker and going direct to the bank.

An independent broker can recommend products from different lenders.

Are there hidden fee's or commissions using a broker?

Generally no.

Over 10 yrs ago, I always went direct to the bank for my I.P's.

So?

Which option is going to be more cost effective to me over the long term?

Wrong question to ask. You should be asking 'which option will be more effective towards achieving my long term goals?'

 

[Aaron_C]

Bank - sells one product so limited in choosing what is best for you.
Broker - sells many loans so there is sure to be one that suits you best.

 

[Terry_w]

The difference is often whether you get approval or not.

I recall a few clients who have gone to their own bank who has said they could not qualify and then I have worked out they can and then got them an approval with that bank.

 

[Colin Rice]

Banks exist to serve shareholders.

Good Brokers exist to serve clients.

Thats 1 of about 30 differences.

 

[Terry_w]

Banks exist to serve shareholders.

Good Brokers exist to serve clients.

Thats 1 of about 30 differences.

well put!!!

 

[Rolf Latham]

Whatever the benefit may be, that benefit increases for Investors, at a guess, linearly to the first IP or 2, and near exponentially thereafter.

ta

rolf

 

[rambada1]

Intelligence

 

[jonmardell]

As the title suggests, if I want to re-finance the loan on my I.P what is the difference between using the services of a finance broker and going direct to the bank.

Are there hidden fee's or commissions using a broker?

Over 10 yrs ago, I always went direct to the bank for my I.P's.

Which option is going to be more cost effective to me over the long term?

With a broker you have more options, price and product is generally the same if not better as we negotiate rates with banks. A couple of the options is multiple lenders equals different valuers which is crucial at the moment and different credit policies. We get paid to serve our customers best interests as majority of brokers clients will come from referrals from other customers. A common practice i see a lot is direct to bank customers are often cross collateralised as the branch is either lazy when they setup loans or directed from higher up to make the customer sticky!

 

[Qlds007]

Unfortunately we aren't allowed to say we are "Independant these days.

 

[donkey]

Banks exist to serve shareholders.

Good Brokers exist to serve clients.

Thats 1 of about 30 differences.

so what are the other 29......

 

[Singo]

Which option is going to be more cost effective to me over the long term?

I am yet to use a broker but I have experienced what sort of mess the banks can create when you deal directly with them. Recently I spent some 5 minutes to explain a bank employee the difference between offset and redraw. I reckon lots of newbie investors mess the deductibility of loans because of banks.

 

[Colin Rice]

so what are the other 29......

I have a report available for $29.99 (normally $99.99) I can send you

This is a joke BTW ^^^^^

Three more for free;

1. Brokers have many banks and products to select from. Banks only have thier home brand products.

2. We only get paid if we get the loan approved and settled. Bank employees get paid either way.

3. *Brokers structure loans for the clients benifit taking into account short medium and long term investing goals. Banks typically are transaction minded.
*Many brokers are bank trained and will give you the same advice and structures if you went straight to the bank.

 

[Singo]

4. The expertise : Bank employees move between departments. And many of them do all sorts of personal loans. Brokers are always doing these investment loans.

5. Communication: Brokers respond fast (FMS replies to emails even before I click on send button )

 

[robbiejuve]

You don't pay a broker, they get paid by the bank, so why not use one? You tell him/her what you want to do and they do all the leg work to get you the finance to achieve it. It's a no-brainer to me.

 

[Terry_w]

You don't pay a broker, they get paid by the bank, so why not use one? You tell him/her what you want to do and they do all the leg work to get you the finance to achieve it. It's a no-brainer to me.

Some brokers charge.

 

[Bigtone]

banks exist to serve shareholders.

Brokers exist to serve one shareholder, the missus!

efa....................................

 

[Peter_Tersteeg]

One major difference is that a single bank has a small set of products and one set of policy to use to meet your needs. A broker has access to multiple lenders products and multiple lenders policies.

With a bank you (may) get the best fit they can offer. If a broker knows what they're doing, you can get a tailored solution.

There are no hidden fees associated with brokers. Most don't charge anything, but where a fee is charged, it must be disclosed in writing upfront. Any fees associated with the loan itself are charged by the bank and you'd get charged these regardless of which channel you use. Brokers are also required to disclose the primary bank fees upfront in their loan proposal documentation.

 

[Spades]

As the title suggests, if I want to re-finance the loan on my I.P what is the difference between using the services of a finance broker and going direct to the bank.

Are there hidden fee's or commissions using a broker?

Over 10 yrs ago, I always went direct to the bank for my I.P's.

Which option is going to be more cost effective to me over the long term?

Hi donkey,
A good broker will set up your loans and structure them to benefit you.
A bank will set up your loans and structure them to scr3w you.

Generally no,there are no hidden fees and the broker get's paid via commission via the bank,which a broker will disclose to you.

I have no idea how many ip's you have but are they with the one bank?
If you have a few,not a good idea.

You'll save money in the long term by using a good broker.

Also you may go to a bank and they may only lend you x amount.
You see a good broker,you may find out you can borrow xxx amount.

I've used PT_Bear and Jamie_M,both are very knowledgeable.Good communication and a nice guys to deal with,highly recommend either.

You can use a broker in your state or interstate as everything is done via email anyways.

I can't comment much on the other brokers on this forum but they seem to know there stuff.

Use a broker and get it structured to your advantage and your long term goals.

Cheers Spades.

 

[geoffw]

Although I generally use a broker now, some years ago I dealt with an especially good personal banker who knew me, and was able to get one especially awkward loan across the line.

Unfortunately good people within a bank get moved on.