Credit broker: Yes or No?

Hello, the rule is that the intermediary does not take anything from you. This has become established in the market. In the past, there were bad apples who charged the customer something.

Of course, these costs borne by the bank are also reflected in the terms. For you as customers, it is not bad, in the end the terms count. And if they are better than the local bank without mediation, all the better.

By the way, the commission is also mentioned in the loan agreement, that is now mandatory.

The credit advisor of the house bank is also internally financed through a commission. And from a business management perspective, it is not necessarily cheaper than the commission paid externally.

We assumed that a loan broker would be a worthwhile thing. We did not ask the local bank first because we were moving away. The loan broker finally got on my nerves because he kept needing more and more documents in pieces for a very secure matter. Eventually, I went to the house bank, they offered me slightly better terms and the check practically did not take place, a yes and that was it. So uncomplicated! However, they had known us for a good 30 years. The local bank at the building site, which had emerged as the favorite during the loan consultation, later asked me why I had not closed the deal. It turned out that they would not have needed the papers that the loan broker kept demanding for their decision. I don’t even know for what purpose I let myself be undressed like that. Conclusion: If there is a long-standing business relationship, I would check that first.

Good luck Gabriele

Hello,
my wife and I (29 and 28), no children, are still newcomers to this topic. I hope I can get some answers to my questions here.
Please don’t stone me if there is already a post about this. Then please provide a link.

Some time ago, we casually consulted a loan broker in the area about what our credit limit might be.

I recommend setting the credit limit at an amount that allows the financing to be completed within 30 years. It is absolutely necessary to leave enough buffer for other activities (vacation, renovation, etc.). Often, a too tightly planned financing is a big stress factor and thus a reason for divorce.

Unfortunately, that is reality...

The broker said that after signing the contract he is paid by the banks through a commission and this conversation was free of charge (it was also free). He showed us examples where his commission ranged from 0.5 to 1%.

The commission can also be as low as 0.25%, especially in Corona times. At least, that’s how I do it. I believe advisors also have to show solidarity with their clients.

Is the credit really not more expensive because of the commission [...]?

Sort of! The only difference is: you don’t actually know how high the (planned) profit of the banks is. So a comparison is difficult.

But yes, the broker can factor the interest rate through his commission. At 0.25%, the lower end of the offer spectrum is reached; 0% is only for good friends and oneself

Is it usual to contact a loan broker or should I inquire at the bank itself? Should I make use of this or take everything into my own hands?
Assuming we get an offer from the broker, can I simply go to my local bank with the offer?

Your decision. The advisor’s offer is and remains non-binding. And by the way, it is free of Schufa (credit check). At least, as long as the interested party does not request a binding commitment. Preliminary inquiries are therefore Schufa-free.

Otherwise, I would be interested in the procedure. Assuming I find a house I like, how do I proceed? The broker told us that we could also contact him for such matters; he could talk to the realtor or seller, which would improve our chances.

Possible. Building yourself is better (about 6% realtor commission). Also, you pay less tax.
(just for comparison: realtor gets SIX percent, financial advisor only 0.25 percent. But that’s a fundamental discussion...)

Friends of ours who are also searching said that for inquiries you should bring or show a financing confirmation directly.

How do I get such a confirmation if I don’t have a house in sight? Just ask the bank? Can I do that anytime or only occasionally?

Yes, some banks offer that free of charge. That way, the seller knows that the bank estimates your creditworthiness to be good and would grant you a loan. Nevertheless, please negotiate!! Don’t be blinded by the confirmation regarding your own finances.

A good advisor actually knows the banks that issue such certificates.

Should you come straight to the point, i.e. say I can afford it, or should I take time to think about it?

The offer is non-binding...

But it is polite to send serious inquiries to the advisor.

I know this is a bit much, but I still hope someone can help me with this.

I hope I could help you. I am also open to further questions.