Non-bank lenders, such as Mortgage House, have become more and more popular with borrowers. This is because non-bank lenders tend to have more flexible and innovative loan products, fewer overhead costs, and lower rates. So what is a non-bank lender, and are they better than traditional lenders?
What is a Non-Bank Lender?
Non-bank lenders are financial institutions that operate much as a bank does; however, they cannot take deposits from their customers. Despite this, they can still offer home loans, car loans, and credit cards at more competitive rates than bigger banks.
Is a Non-Bank Lender Better than a Bank?
It depends on what you’re looking for. There are advantages and disadvantages that come with using a non-bank lender.
Some advantages include:
- Non-bank lenders can provide lower rates and fees for good borrowers that pay their loans in time as well as help honest borrowers secure a home loan that have less than a perfect credit rating that includes who are self-employed secure home loans.
- Non-banks report their results to APRA & is regulated by ASIC.
- They can offer competitive and cheaper interest rates than traditional lenders.
- They have lower startup fees and fewer ongoing fees.
- They can approve loans faster.
- Their service is more personalised because they are smaller.
Some disadvantages include:
- They cannot provide banking products like savings and checking accounts.
- They may not have a lot of physical locations, so their services may be primarily online.
If you are interested in a non-bank lender for your home loan, contact the experts at Mortgage House today.
