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Reasons to Use a Bond Originator

Three Good Reasons to Use a Bond Originator

It is estimated that around 65% of the home loans granted over the past year, were facilitated by bond originators. Some believe that this percentage will increase even further as the economic slow-down forces banks to become more stringent in the application of their lending criteria, and consumers to become less inclined to face the frustration and expense of having to call on a variety of banks when needing to secure a mortgage.

Perhaps if the banks were better enabled from an internet perspective, the situation would have been different. But, they are not. Although you can take the time to wade through their many mortgage product offerings, there is precious little else you can accomplish from a comparative shopping exercise perspective. You are still going to have to call, complete a set of forms, and submit supporting documentation at each and every one of these banks to find out whether you meet their lending criteria and, if you do, which interest rate you stand to qualify for. There simply is no changing that.

Working with a bond originator is the more effective alternative. Here is why:

Bond Originators have their fingers on the mortgage pulse

Bond originators are ‘on top’ of what is happening inside the banks they represent. They know about the ongoing changes these banks make to their lending criteria, their processes and their products even before these hit the internet sites.

Here is an example of a recent change that could cause huge frustration to those who prefer dealing directly with the banks: All the banks, except FNB, have changed their loan to value ratios (LTV) on residential properties. Value based sliding scales are now used to determine the maximum percentage of the home’s value that can be borrowed. 100% loans are no longer a given. As a consumer, you will not necessarily be aware of this because, as at the time of this article going to press, not one of the banks included these changes in the product descriptions on their internet sites.

Changes that could affect your property purchase in a variety of different ways are made all the time. Your bond originator will know about these, upfront. Chances are you won’t.

Bond Originators make mortgage applications simpler and faster

Bond originators simplify and speed up the application process. When you work with a bond originator, you only need to complete one application and provide one set of supporting documentation to them. This they electronically submit to all the banks they represent. Because the banks have such a high reliance on the bond originators for business, they are quick to respond with in-principle acceptances.

Bond Originators know what you need to succeed

Working through a bond originator will improve your chances for success. Bond originators generally come from a banking background, so they have a good insight into how the lending criteria set by the banks, will be scored. If need be, the bond originator will assist you with the completion of the form so as to ensure that all the relevant information is included. They will also do a pre-assessment to check whether your profile is likely to match the criteria set by the banks and help you understand upfront whether the size of bond you wish to apply for is within your affordability range or not. An added bonus is that they are more likely to secure a better interest rate on your behalf than you would if you had to go it alone.

Over and above having the appropriate knowledge, your bond originator also has a vested interest in your application succeeding. Because the banks only pay them for approved applications, your bond originator will do everything humanly possible to ensure that you crack the nod.

To conclude

In short, bond originators remove the painful bits (frustration, delays, duplications etc.) from the mortgage application process. And, if that is not enough, their services are directly paid for by the banks – not indirectly by you.

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