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Real estate agents linking up with mortgage brokers

Harcourts real estate company is the majority owner of Mortgage Express and Harcourts' agents refer buyers to Mortgage Express advisers, who sometimes work out of the same office as the agents.

Bayleys real estate also has financial ties with mortgage and insurance broking services Lifetime Group and the Rothbury Group, where their agents also share offices with brokers.

Bayleys said agents were paid a "modest contribution" for referrals.

Real Estate Institute chief executive Bindi Norwell said the reason real estate companies were expanding into the mortgage broking business was to provide a "one-stop shop" for consumers.

Ms Nowell said agents should disclose any relationship that generates financial reward and any financial benefits they receive outside of their usual commission.

But Consumer NZ said rules governing the industry weren't clear cut and have yet to be tested in court.

In Australia, regulators reviewed the mortgage broking market and found no clear evidence borrowers got a better deal.

Do you really need lots of income for a mortgage?

You can spend a lot of your income on housing if you don't carry debt. The VA program, for example, allows DTIs up to 41 percent. If you carry no other debt, you can spend that all on housing. I

If you have at least a 580 credit score, FHA lets you spend up to 40 percent of your monthly income for housing if you are otherwise debt-free.

There are also “compensating factors” which help borrowers stretch income. They include good cash reserves, excellent credit, conservative use of debt, a career in a lucrative industry, and a new house payment that's no higher (or not much higher) than the previous housing expense.

In some cases, the FHA allows borrowers to stretch their DTI to 50 percent if they have the right compensating factors.

Choose the right lender

Rule #5: Beware of buffers. In some cases lenders “layer” or “buffer” mortgage qualification standards. It may be that the DTI max is 43 percent for a given loan program, but some lenders might have a top DTI of 42 percent and sometimes even 41 percent.

Is a mortgage broker or a financial advisor better when you want help getting a good mortgage deal?

We know how much we want and know we can afford it, we just want to go over the options and get a good deal, but I don't know who would have more options, be more honest, etc. We are in the UK.

The difference between a mortgage adviser and a financial adviser is the qualifications they hold.