OPINION: IN my experience as a professional property investor and educator, I’ve seen many home buyers too uncertain to move forward once their home loans are approved. Unfortunately, that equates to tens of thousands of dollars, which a mortgage broker has worked for, that may not come to fruition.
In my regular seminars, brokers have said they’ve experienced the same. So how can a broker get people over the line – especially when buyers can be distrustful of brokers (and real estate agents), who have a vested interest in their decision? Often it requires a lot of knowledge on the broker’s side and trust on the buyer’s side.
As a buyer, people are usually cautious of brokers. The first thing to look for when dealing with a broker is to select someone who can walk the talk. A great thing to look at in a broker is the amount of information they share with you. Does the broker have a long-term wealth strategy for their own portfolio, which they can share with you? Or are they trying to get wealthy by simply selling a lot of mortgages? As a buyer you need to look beyond fancy marketing material and go with a broker who has a genuine interested in furthering your portfolio.
Ask your broker if he has a particular strategy. This will demonstrate his competence as well as his willingness for information sharing. Part of my own strategy as an investor is to buy around the median price, because if the majority of the population can afford to live in it, I’ll always have a tenant, and there’ll always be interest if I have to sell.
Brokers have extensive knowledge in the property market which buyers often ignore. Don’t dismiss your broker if they try to educate you. Rather than telling your broker what to do, you should want them to educate you about what’s new in the market and to come up with new ideas that you can use to make or save more money. Certain brokers may educate one-on-one or in a group, either option will be of benefit to your career as a property investor.
Through education, brokers can engage clients by pointing them to the bigger picture. For example, home buyers can spend so much time weighing up one loan against another. But what difference does saving a few hundred dollars make, when a well-bought property can save or make buyers tens of thousands? A simple fact sheet can easily highlight this difference, and most prospects will understand what their focus should be.
As buyers we can also get emotional over a property purchase, which can freeze decision making. A broker is therefore of great assistance as they can assert a steadfast financial perspective, which should be maintained throughout the entire investment process.
By Chris Gray.* Chris Gray has almost 20 years’ experience in property investing and financial education. He is host of Sky Business News Channel’s “Your Property Empire” every Friday, and was Financial Judge on Network Ten’s “The Renovators”. Today, he builds property portfolios for time-poor professionals – searching, negotiating and renovating on their behalf. Visit www.yourempire.com.au.
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