Nila Sweeney

There are some excellent home loan deals available online at the moment but how can you make sure you’re dealing with a legitimate lender and not a fly-by-night operator?


Heidi Armstrong, directors of operations at non-bank lender State Custodians Mortgage Company, offers the following advice for borrowers attempting to choose between online lenders:


  1. Look for depth: there’s more to servicing a home loan than offering a template website and a headline rate.


  1. Make a phone call: if you have to leave a message or no one gets back to you quickly, they may be understaffed. It is also better to talk to someone in person about your particular requirements.


  1. Look for intimate service: smaller lenders should be able to provide intimate levels of service. However, watch out for one-man shows. If you get an email from the CEO, it is probably not a good sign. Check how long they have been in operation.


  1. Research online: individual comparison websites and publications like Your Money have detailed information on good companies and rate them accordingly.


  1. Ask for accreditation: lenders must be licensed with ASIC so ask for the ASIC number if in doubt. They should also have a Credit Ombudsman number available in case customers want to make a complaint. Lenders should also be members of the Mortgage and Finance Association of Australia (MFAA) or the Finance Brokers Association of Australia (FBAA).


  1. Ask where their funds come from: if they are not comfortable discussing that topic, move on to another lender.


  1. Look for transparency: information on fees, terms and conditions should be visible on the website home page or easy to find.


  1. Look for a good website: it is an online lender’s office. It is where you are conducting business with them. If it is full of glitches perhaps other areas of the business are also full of glitches.


  1. Look at the headline rate: if it seems too low it may not be sustainable. In a 30-year financial relationship you want full service, not to be signed up and left to fend for yourself. Remember the service you get from your first contact with the company is likely to reflect the service you will get going forward.


  1. Check staff numbers: size is not everything but the more troops on board the more able a company is to cope with busy times.


  1. Consider years in business: online lending is relatively new but there are several operators that are starting to show signs of longevity. Others may still have to prove themselves.


  1. Consider product range: companies with more available products are more likely to match an individual’s circumstances than if they only have one or two loans on offer.

Whether you are looking to buy your first home, move home, refinance, or invest in property, a mortgage broker can help. Access loans from all the major lenders, get help with paperwork – plus there is no charge for this service. Get help from a local mortgage broker