Why use a finance broker?

You might be asking why you should engage a broker – isn’t that an added cost, when you can approach the bank yourself?

There are four key reasons why using a broker will benefit you: choice, time, money and confidence. Put them all together and you’ve got a holistic solution that will deliver the results you need.

Choice

The difference between approaching the bank direct and using a broker is that brokers have numerous lending options available, not just one. What this means is more choice and therefore a better outcome for you.

Having choice gives you options on various policies, products and pricing that suits your specific requirements, rather than taking a one-size-fits-all approach. Choice ensures that your needs are met with the most suitable loan product for you.

Choice is the key benefit of using a broker, and choice provides you with flexibility.

Time

The process of putting a loan application together, whether it’s personal or for business, is extremely lengthy and often complicated. The number of requirements continue to grow year on year due to increased regulatory requirements.

Engaging a broker means you can secure your finance more quickly – again, the greater range of choice means a variety of banks to choose from, all with varying timeframes for approval. It also takes time to research your options. Engaging a professional means that you’ll be advised on what the most suitable option is, saving you the hassle of approaching individual banks for information.

A broker will complete application process for you and ensure it is done correctly. If your application is submitted with missing information or needs to be amended due to errors, the process is further delayed – this is more likely if you’re trying to do it yourself without fully understanding the process and requirements. A broker knows how to put an application together and will ensure that it’s all done efficiently and effectively.

Most importantly, the time you save from using a finance broker allows you to spend more time on your business doing what you do best.

Money

One of the key benefits of using a finance broker is that they can open up the market and obtain better overall pricing on your loans. They ensure that the bank/s who want to keep or win you as a client fight hard to secure your business.

Better overall terms can free up your cash flow, which can help direct funds towards other requirements such as new assets, working capital and investments.

As for the cost of engaging a broker, it’s actually a low-cost service, as brokers are mainly remunerated by the lenders. Some service fees or processing fees may apply (case by case), however generally speaking brokers are paid by the lender for introducing the client and loan to them. A trailing income will also be paid by the lender to the broker for ongoing loan management and service to the client.

Confidence

An experienced broker can provide confidence in achieving your desired outcome by giving feedback on the strengths and weaknesses of your application before it is submitted – as the saying goes, ‘you get one chance to make a good first impression’.

Brokers keep up to date with changes in banking policy, which is important when choosing a lender. It can be the difference between success and failure. Knowing the key criteria for approval, and addressing the main concerns for any lender, is where a broker demonstrates value.

Engaging a broker also gives you access to a trusted network of bankers, lenders and associated service providers. These key networks are invaluable in achieving the most suitable outcome and experience for you.

Above all, when you engage a broker, you are entering into a partnership. Brokers work hard to achieve the best outcome for you and building that confidence and trust is a key aspect to a long and beneficial partnership.