Expectations, Education and Opportunity
ALI’s mission is protecting home and property buyers, so, it made sense to us to explore what Australian property buyers want and need. That’s why we commissioned CoreData to survey over 1,200 prospective and existing home buyers to learn more.
Here’s what we discovered.
Mortgage brokers are the most trusted advisors
Whilst the Australian Financial Review reports that only a small percentage of Australians seek independent financial advice (4% of 25 to 34-year-olds and 13% of 35 to 44-year-olds)1, it seems consumers are looking to mortgage brokers for information and advice about the home buying process.
Our survey results revealed that ‘expert advice’ was the most important reason for homebuyers to seek out a mortgage broker, followed by:
•Obtaining a better deal
•Recommendation
•Greater choice
•Convenience
•No time to myself
•Ongoing relationship
If you are looking to borrow to buy a home or to refinance your existing home loan, a mortgage broker can help you find the loan to suit your individual needs. They deal with home loans every day and have the skill, knowledge and expertise to provide the information and advice you need
99% of home buyers expect to be told about financial risks
Of the prospective homebuyers we surveyed, 99% expected that their broker or lender to discuss the risks to their financial security, including what may impact their ability to repay their loan.
But, only 35% of those who went through the loan process recall loan protection insurance being discussed
Given the potential for a serious medical event to strike during a lifetime, it is concerning that we found only 35% of our respondents could recall being informed about loan protection insurance.
Just as worrying, 50% of existing home buyers surveyed cited a lack of understanding as the reason that they chose not to take out loan protection insurance.
An ALI authorised mortgage broker can help you to understand the risks of borrowing and explain the benefits of loan protection insurance to you. You owe it to yourself and your family to understand what Is available to protect your financial future.
88% of homebuyers don't understand that LMI covers lenders, not borrowers*
Lenders Mortgage insurance, also known as LMI, may sound like it provides a potential benefit to homeowners, however, what many buyers don't understand is that this insurance provides financial protection for the lender only.
If you are looking to borrow to buy a home or to refinance your existing home loan, a mortgage broker can explain Lenders Mortgage Insurance (LMI) to you including when it might be required, how much it might cost you and how and when any benefits might be paid to your lender – and why it doesn’t provide you with any protection.
With 80% of survey respondents stating that their family would be negatively affected if they were unable to make an income (rising to 90% for prospective homebuyers) and over 96% of prospective homeowners wanting to learn more about loan protection insurance, we believe that making an informed decision has never been more important.
You can download a copy of our survey here.
If you want to know more, get in touch with your local ALI-authorised mortgage broker or alternatively, request your home loan protection quote here.
*ME's Property Literacy Survey 2018
1. https://www.afr.com/business/banking-and-finance/mass-financial-adviser-exodus-puts-900-billion-in-play-20180523-h10fpf
Loan Protection Plan is jointly issued by Hannover Life Re of Australasia Ltd ABN 37 062 395 484 (Death, Terminal Illness, Living and Accidental Injury Benefits) and QBE Insurance (Australia) Limited ABN 78 003 191 035 AFSL 239545 (Involuntary Unemployment Benefit). It is distributed by Australian Life Insurance Distribution Pty Ltd ABN 31 103 157 811 AFSG 226403 (ALI). ALI receives commission for each policy sold. Any advice provided is of a general nature only and does not take into consideration your personal objectives, financial situation or needs. You should consider the Product Disclosure Statement when deciding if this product is appropriate for you.