Mortgage brokers are a vital part of the housing industry in New Zealand. They write about 40% of all residential and commercial mortgages in New Zealand, and provide an essential consultancy, advisory and assistance role for all classes of borrowers.
The most likely group to use a mortgage broker in 2017 is the first home buyer, as banks have tightened up their mortgage lending criteria in the last two or three years making it more difficult for first time borrowers to qualify for the mortgage they want and to negotiate all the paperwork.
Government restrictions and the reserve bank have forced Banks to only allow mortgages for first home buyers with a 20% deposit, unless the buyer meets certain restrictions regarding income and their work and savings history. All the banks spell out their lending criteria clearly on their web pages, but the process can appear confusing and intimidating to the first home buyer who has never been through the mortgage process before.
The good news for these buyers is that mortgage brokers Christchurch are free, and so this makes the mortgage broker an attractive pathway for the first home buyer. The even better news is that mortgage brokers are paid by commission by the banks, generally 0.65% the loan value, and hence the broker is very motivated to succeed for their customer. This has in fact always been the case, and up to 2011 there were many brokers in the industry who were happy to bend the rules and tell white lies about their clients in order to win that precious mortgage. This lead to a lot of problems that were very clearly exposed during the financial crisis of 2008/2009, including a large number of borrowers who should never have been given a mortgage of that size. The cost to the banks and personal damage to borrowers during that period was enormous, and this led directly to new and tighter regulations of the sector.
The result is that in 2017 first home buyers can trust their mortgage brokers Canterbury to provide them with expert advice, to not tell any untruths on their behalf, to not saddle them up with a mortgage they cannot afford, and to find and action the very best deal in the market. The mortgage broker clients can feel safe knowing that they have a recognised complaints procedure if there are any problems.