There should be no mystery when choosing a mortgage: Lisa Montgomery

Mystery flights and mystery hotel deals are popular. Why? Because for many people, not only does the price appeal, but there’s also a certain mystique attached to not being aware of where you are going.

But these "mystery" deals are only defined moments in time, so if we come away thinking we could have done better, or would have preferred a different experience, we can easily put it behind us and move on.

However, when you’re making the biggest financial decision of your life, do you really want any ‘mystery’ associated with it, particularly when it’s such a long-term and significant arrangement? After all, this is your financial security you’re dealing with here.

In my long career in the financial services industry I have always been a huge advocate of research. And when you are looking for a home loan or any other financial product, the best research is the research you do yourself.

There are some great financial services comparison websites out there where you can start that research and compare what’s available.

And in the course of that research, you will undoubtedly come across a variety of marketing offers you can take into consideration, along with your research.

One offer that recently stood out was a "mystery" home loan deal, which offered a significant reduction in the annual percentage rate of the big four banks, but did not mention the lender.

So what impact does this have on a borrower when they see such an offer, but don’t have all of the details?

Clearly they would find it attractive, but further research would show there are equally competitive rates aplenty in the mortgage marketplace.

There is no doubt that a low interest rate is the major priority for all borrowers choosing a home loan, but making that decision based simply on the interest rate is a common mistake, as there is much more to a mortgage product than rate alone.

And that’s because no two borrowers are the same.

We all have different needs and requirements for how we want our mortgage to perform for us. So when you’re looking for a loan, it has to be a personal decision not based on one thing, but on a range of aspects relating to how you manage your wealth through your different life stages.

Therefore, a borrower needs to also look at the fees, features, flexibility, structure and service attached to the loan - and once they do, there are many more questions to ask.

For example, are there low or no fees attached to the home loan?  What are the specific features and are they the most appropriate ones for my circumstances? And is the structure going to be flexible enough for what I may need now and into the next stage of my life?

However, above all else, not knowing the service proposition attached to a mortgage is a bit like marrying someone you’ve never met.

You need to take the time to choose wisely here, because the relationship with your lending professional can be one of the most significant in your life, particularly in regards to setting up an efficient and effective financial platform.

And yet, is it still often something people undervalue in favour of obtaining the lowest interest rate possible.

In fact, the expertise and guidance of this person can open up doors to wealth creation and deliver information that can save you money on interest, reduce your loan term and strengthen your overall financial position.

You should closely consider your lending professional as your first point of contact when enquiring about a mortgage, as this relationship is as important as the interest rate.

With many of us having complicated financial structures, it’s invaluable having the right lending professional there to advise you, educate you and above all empower you to become a better financial manager – and there’s certainly no one-size-fits-all solution.

Like choosing any partner, you need to know you can rely on someone to be there for you to take those next steps and never more than when your finances are involved.

In such a dynamic lending environment, there is much for borrowers to consider and explore – and there should be no mystery when it comes to choosing your mortgage.

Lisa Montgomery is CEO of Resi Mortgage Corporation.