When you contract a broker for a credit, he will defend your file in order to get you better terms.
A broker is an intermediary, so the loan broker is the intermediary between the financial institutions that sell credits, and the individuals who buy the credits.
Brokers can intervene with both individuals and businesses. When you mandate a broker to obtain a credit that is real estate, or consumption, you hope that he will be able to defend your file to get you better financing terms. It can also be to find a credit agency, when you have only been refused for your loan applications.
The broker works with many financial institutions, and he has many clients who like you, are looking for financing, because of this, his trading margin is higher.
The broker not only negotiates the APR (Global Annual Effective Rate), he negotiates all loan conditions. In this way, he can negotiate the absence of prepayment indemnities, the insurance of your credit …
The credit broker must be registered with the ACP, the Prudential Supervisory Authority, he must have professional liability insurance. When you use a broker, you do not have to pay anything until your file is accepted by the broker. This regulatory provision is found in the Monetary and Financial Code, Article L519-6. Brokers work with many financial organizations, they earn a fee from the financial institutions with which they work.
By using a credit broker, you save time, you will not have to contact many credit agencies directly, the broker will do it for you. The broker who will follow your file will be able if you are in difficulty with the banker who granted you the credit, to help you to respect the clauses of your credit agreement. In addition, often your loan file is processed more quickly.
In addition, because of his technical knowledge, the broker can be the right interlocutor to advise you in the setting up of your loan, whether it is a mortgage (devices such as the PTZ, regional aid …) or a credit to the consumption.
Brokers choose the financial institutions they want to work with. Thus, despite the fact that brokers do not advise you to put them in competition, under the pretext that your file could arrive at the same bank by different channels; you may be interested in contacting several brokers.
However, we advise you to contact directly some financial institutions, it is possible that the broker is not able to provide you a better rate than that which you will be able to obtain by your own means.
By using a broker, the proposal he will provide you may require you to domiciliate your income within the institution that will provide you with your loan. Although the broker is paid by financial organizations, he may charge you brokerage fees.
Depending on the broker, the brokerage fees may or may not replace the application fees. These costs are taken into account in the calculation of the APR.