So You Have A Specific Mortgage Minimum You Need
The first thing that you must ask a broker is if they are a mortgage broker or an agent. Most states require that agents have a license and are able to perform mortgage broker functions. Keep in mind that there are many different variations of mortgages you may want and you want a qualified professional to help you choose which path works best. A broker is typically compensated by the lender.
According to Beyond Mortgages: The Best Source For Information You Will Ever Need, a broker can already pay all the closing costs, which can save you up to 33% of the purchase price. On a $300,000 home, that means you save $18,000 or more.
Most states also require that a broker must be a mortgage professional for a minimum of 5 years. A broker that has been in business for many years has seen many changes in the industry and is therefore experienced whether the industry is booming or crashing.
The Benefits Of Using A Mortgage Broker
Brokers have access to and established relationships with many lenders and banks. They are also able to shop around those lenders to find the most cost-effective products and interest rates available to you. A good broker can also navigate a lot of the difficult paperwork and deal with the underwriters; making the purchase process much easier with less hassle. You will know right away if you are working with a professional.
The Disadvantages Of Using A Broker
Even though a broker can get you pre-approved for a mortgage, that doesn’t mean that you are going to get the best deal. The agents often have more connections. They have a list of lenders they have established relationships with and can offer you more personalized service. A bad broker can end up using up a portion of your valuable time getting back to you after the purchase was through. A good broker, on the other hand, will make sure that you are spending your time wisely and getting the best return for your efforts. A good broker is skilled in all the different elements of helping you get the right loan, and be able to crunch the numbers for you to ensure that you are getting the best deal.
So, How Do You Select A Mortgage Professional?
First, ask your friends and family who they have used for a mortgage. You can also ask for references, and check for websites and reviews. Once you find someone you feel is professional, you can call them to make sure they did a good job.
Contact the broker and get their rates. Then, ask them to also provide you with the benefits of using them for your mortgage. Do they go above and beyond to make sure you are happy with the lender? Ask for any extra services they can offer you.
The last question you should ask them is if they lock in their rates. These days, rates can change on a daily basis. As rates change, your mortgage rate may change as well. You don’t want to have to refinance at a moment’s notice. You want to feel safe where you are putting all your money.
Most brokers will make some money on your transaction and may also charge fees. However, there’s a lot of work that goes into finding the right broker for you as well as the right mortgage. In the end, working with the right professional is best for you, and it yearns for you to be happy with your purchase. Your home is likely the biggest purchase you’ll ever make.