Fact: You don’t pay more by going through a broker than direct to the same bank. But, who pays your finance broker? It’s a qood question.
When was the last time you booked a hotel for your family holiday only by going straight to the hotel’s website, entering your credit card details and pressing send? A long time ago right?
These days we check out the options on price comparison websites. That’s because we all like to shop around for the best deal. To see if we can save any extra pennies to spend on the holiday itself. The same goes for finance.
Finance Brokers don’t cost you more
If they don’t cost you more than going to the bank direct, who pays your finance broker?
Brokers get a commission or a fee from the bank for bringing your business to them. The bank pays because working with brokers actually saves them money.
Not only do brokers bring business to banks, they also do most of the legwork so the bank doesn’t have to. They work with you to gather up all of the necessary information the bank needs to make a decision to give you the funds.
Brokers understand what banks need from you
Banks like finance brokers because they save them time as well as money.
Brokers often cut down the time banks need to approve a loan because they understand the information banks need and how to package it in a way that the banks can easily process.
This is good news for the bank because it saves them time and effort to secure your business. And because this saves time for the banks, it also saves time for the borrower.
Brokers get paid when the deal is done
Banks know that finance brokers only get paid once the deal is settled. So brokers work hard to make sure they get exactly what they need from you when the bank needs it. This means the banks can settle your deal sooner.
Brokers understand which clients fit best with each bank.
Finance brokers exist to get the best deal for you.
Brokers understand the type of deals and transactions the different banks are looking for, and which clients suit which banks. So, brokers are able to save the bank’s staff time in processing and decision making by understanding if the borrower is right for each particular bank.
A broker won’t waste your time or the bank’s time trying to fit a square peg into a round hole.
Final thoughts
Now you know who pays your finance broker and why. Banks like brokers because they save banks time and money by making things easy for them. They find the right clients for each bank and bring all the necessary information for the bank to make a decision. This works for borrowers because it makes sure you’re dealing with the right bank in the right way at the right time.