When you’re in debt, one thing that can seem out of reach is buying a new car

You might not have the credit required to get auto loan financing, and managing monthly payments might put your other debt repayment plans at risk. However, being in debt is no reason to drive a car that’s breaking down or unsafe. There are plenty of good, affordable used cars out there, and late model used cars have a lot to offer in terms of reliability, gas mileage, safety features, and performance. If you’re in the market for a pre-owned vehicle, here are a few tips you can keep in mind to make your shopping experience fruitful and stress-free.

 

  1. Set a budget

 

The first thing to do is figure out exactly how much money you’ll be able to put towards this purchase. Be realistic, but bear in mind that the more you can invest in a new (used) car, the more reliable it is likely to be and the less you’ll have to pay for maintenance and repairs in the near future.

 

  1. Choose your car

 

Next, pick a make and model that fits in your budget and has the features and options you need. If this is going to be a family vehicle, make sure it has room for all the passengers you’ll be carrying, and if you have a baby or toddler, verify that it will have the space and hardware to allow you to safely install a car seat.

 

  1. Find sellers

 

There are lots of online car buying directories that can help you located used vehicles from reputable sellers. They can also provide you with reviews, videos, comparison tools, and other site features that can help you in your purchasing process.

 

  1. Check the vehicle history

 

Once you’ve found a specific car you’re interested in, get a vehicle history report. You’ll want to know if it was in any major accidents or has had any significant repairs done on it. The internet has made it easier than ever to get a comprehensive history report on any car, so don’t skip over this important step, and don’t let a seller talk you out of requesting it.

 

  1. Take it for a test drive

 

Just because you’re not at a dealership doesn’t mean you can’t take the car for a test drive. Make sure it handles properly, feels right, doesn’t make any strange or ominous sounds, and that you feel comfortable and safe driving it.

 

  1. Negotiate the price

 

Don’t be afraid to give the seller a counter offer and try to bring the price down from what they’re asking for it. This is expected. Also, don’t be afraid to walk away from a deal and keep trying if you don’t feel like you’re being offered a good value for your money. There are always other cars.

 

Once you’re satisfied with the deal, make sure the title paperwork is processed correctly and enjoy driving off in a pre-owned vehicle that’s now all yours!

mortgage brokers

How do mortgage brokers get paid?

Home loans provide their services cost-free to interested debtors and are instead compensated by lenders. We delve into some of thedifferent commission structures that mortgage broker obtains to help you ensure that you’re receiving affordability and not engaging with a broker who may have a conflict of interest.

Exactly what is a mortgage broker?

A mortgage broker functions as an intermediary between debtors and lenders. They help clients find a loan that suits their situation by researching, contracting and negotiating for bargains concerning the client.

What activities will a mortgage broker do?

  • Assess your borrowing requirements. Agents should also determine your serviceability potential across different situations.
  • Identify home loan products that fulfil your requirements
  • Negotiate in your stead for the best deal
  • Provide support for just about any questions you have many throughout the process
  • Organize the paperwork to secure the house loan

How are mortgage brokerages paid?

Mortgage broker gets a commission payment from lenders. This payment will vary concerning the lender as well as how big is the transaction.

Upfront commission

The upfrontcommission is the payment a broker will get for introducing the home loan customer to the lending company. It is normally around 0.3-0.5% of the loan value. For example, for a $850,000 mortgage, a 0.3% commission rate would total about $2,550 in the broker’s pocket.

Trail commission

Trail percentage is a recurring percentage that is computed based on the rest of the loan amount every year, which is paid to them monthly. Some lenders offer a continuing fee of 0.1-0.2% predicated on the rest of the value of the house loan. This commission payment is paid for the broker providing ongoing service to your client.

Claw back of commissions

If a person refinances the home loan suggested by their mortgage broker to some other lender in just a certain timeframe, then your initial lender can take a clawback commission payment from the broker. It is because it could be costly for a lender to set up a fresh loan for the customer, and the lender loses away if the client then decides to release the loan.

A few mortgage broker  in these situations has opted to spread the fee to their clients. Thisis not against the law in Australia so long as they follow the right guidelines.

It’s estimated that only 1-2% of total loans are subject to claw back every year, and therefore it does not represent a major issue for the broking industry, but it is still important for brokers to educate their customers about howclaw back provisions work.

Issue of interest

Because most mortgage brokers get commissions, an issue of interest can occur in some cases. For instance, an agent might promote a certain home loan with a lender that offers an attractive commission over one which offers a lesser commission, regardless of whether or not it is the best product to your requirements. That is why it’s important to speak to your broker about their fee structure.

What are my rights as a client of any mortgage broker?

The National Consumer Credit Protection Function (NCCP) aims to protect you as a customer of the mortgage broker by ensuring that the broker will not recommend an ‘unsuitable’ loan for you. This means the mortgage broker must carefully consider your needs and requirements, together with your finances, to make sure that you will be able to service the loan without enduring financial hardship. See more this site: mortgagebroker247.com.au