(THIS ARTICLE IS MACHINE TRANSLATED by Google from Norwegian)
In short, a loan broker can be a shortcut to getting you a high number of loan offers. Obtaining many offers is important when you are comparing conditions, and thus find the cheapest solution. You can of course do the job yourself, but then you need to know as many banks as possible.
Here you can read about what loan brokers do and do not do, about advantages and disadvantages, and how to distinguish between skilled and less skilled brokerage companies.
Unclear market for unsecured loans
There are over 30 financing companies and banks in Norway that focus exclusively on so-called consumer financing, ie loans that can be used freely and that do not require security. In addition, almost all savings banks also offer this type of loan. Most of us know DNB, Sparebank1, Nordea and maybe the local bank, but how many have heard of, for example, Easybank, Santander and Nordax?
One of the advantages of a loan broker is that you do not have to get an overview of all the players. However, the choice of brokerage firm is about as important as the choice of bank.
Good and bad loan broker
The loan broker usually does a good job of applying, but there are still differences that are worth noting. The most important factors are the number of banks the brokerage company cooperates with, and secondly which banks we are talking about.
For example, it would be inappropriate to search through a company that represents only a few banks. Likewise, it would not help you much if the banks do not have competitive offers, or if they do not offer loans of the size you need. Service level and how efficiently they obtain the offers are also partly important.
This is what you should look for when choosing a loan broker:
- What is the number of partner banks?
- Which banks are represented?
- Do the banks have the type of loan you need (loan amount and terms)?
- Does the loan broker have a customer center?
- Is it easy to get in touch with the customer center?
Find the loan brokers
Most comparison sites for unsecured loans online have an overview of both banks and loan brokers, including the website Billigforbrukslån.no. There you will usually find information about which banks the brokers represent, what the loan amounts are, what interest rates you can be offered, and more. They also advertise frequently online, in newspapers, on television, and in other media.
Loan example: Effective interest rate 9,64%, NOK 100.000, o / 5 years, Cost NOK 25.246 Total NOK 125.246-.
How many loan offers are common?
Several of the companies work with somewhere between 15 and 20 banks. If you apply through one of these loan brokers, you can potentially receive offers from all partner banks, but not necessarily. Among other things, it will depend on the loan size you apply for, and which banks consider you creditworthy. There are also differences between the banks in what requirements they set for age and income.
For example, a person who is 30 years old will be able to receive more offers than a person who is 18 years old, even if both used the same loan broker. Likewise, some banks would not bid because the loan amount applied for is higher than this bank's loan limit.
Free and without obligation
According to the Financial Contracts Act, a loan broker does not have the opportunity to demand payment from the person applying for the loan. The brokerage companies instead receive a commission from the bank with which you may enter into a loan agreement.
You receive all the offers
The loan brokers cannot influence which of the banks you may borrow from. The applicant will receive all the offers from the partner banks that consider the applicant creditworthy. This will allow you to easily compare the terms and conditions of the various offers before making a choice.
You have the same rights
If you take out a loan that is arranged through a loan broker, you have exactly the same rights as if you applied directly to the bank. The rights are determined in the Financial Contracts Act and apply regardless of which bank you choose to borrow from.
The brokerage companies do not need a license to mediate loans, but they are naturally obliged to comply with Norwegian legislation, and they are subject to Finanstilsynet's regulations.
The loan is a matter between you and the bank
If you take out a loan, the contractual relationship is exclusively between you and the bank. The brokerage company's role is only to mediate the offers, and they have no responsibility for what happens after the loan has been paid out.
Are the offers getting better?
Loan brokers often market themselves with the fact that the terms of the loan can be improved if you search through them. Whether this is true is not always easy to know. The terms you are offered are determined by each individual bank, and depend primarily on your ability to pay and your credit score.
The advantage of loan brokers probably lies more in the fact that it is faster to obtain many offers, and you do not need to have a full overview of the market yourself.