Monday, February 25, 2008

Pre-Approvals first step towards a home

I heard that one of the first steps to take is getting a pre-approval. Getting a home loan is probably one of the most daunting tasks that a first homebuyer faces because you dont know whether the 25, 30 or 45 year marriage to the bank is going to be a good one or not. Sure, you can switch around but there has been a lot of talk about the costs of switching from one mortgage provider to another.

I’m told that the closest person to a friend in this process is a mortgage broker. Even then, many of them receive commission from banks etc for recommending them to you. They do disclose how much they get from the banks but even so, it makes you that much more wary knowing that he is being rewarded for his work. One thing I have noticed though is that because the industry is awash with such scepticism, a mortgage broker should do their best to win customers by word of mouth. If I were a mortgage broker, it may make sense to take the relationship one step further than offering movie tickets to anyone who refers them to someone else. Anyway.. this step is not for me just yet, I need to learn more general stuff about buying a house and hey, Perth property market is dropping so let’s just wait and see how low we can go.

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