Mortgage Broker 101: How Brokers Simplify The Mortgage Lender Search


Buying that very first home is a major process, and it's one that many potential buyers find overwhelming. Not only do you have to deal with actually finding the house that you want, but you also have to figure out how you're going to pay for it. Filling out mortgage applications and choosing your mortgage lender can be difficult when you don't fully understand the process. Mortgage brokers can do a lot of the work for you. Here are a few things you should know about consulting with a mortgage broker to get your home loan.

Understand The Role Of A Mortgage Broker

Unlike a traditional mortgage lender that you can apply with directly, a mortgage broker is essentially a go-between for you and many other mortgage lenders. The broker will talk to you about your financial situation, will evaluate your credit history, and will do a lot of the legwork for you. The broker will work with multiple mortgage lenders who can potentially help you finance your home purchase. Using the information about your situation, he or she can find the best match for your needs and help you facilitate the loan application process.

Why Should You Call A Mortgage Broker?

Mortgage brokers are beneficial for home buyers because they can save you a lot of time, and they can open up possibilities you may not be able to find by yourself. After all, brokers have a large library of lenders they can turn to, and they have an established relationship that allows them to negotiate rates and terms to help get you approved.

In fact, since mortgage brokers often have not only local mortgage lenders but also national ones, they can often find you a loan that allows for waiving loan fees and minimizing points. This can ultimately save you quite a bit of money over the life of your loan.

Some banks work only with mortgage brokers and not directly with buyers, so working with a broker may actually open up opportunities you'd otherwise miss out on if you were just working with the finance officer at your bank.

Finally, working with a mortgage broker can also save you time and effort in the loan shopping process. You won't have to spend the time filling out multiple applications, you won't have to spend the hours on the phone negotiating with lenders or answering underwriting questions. This can make the entire process far less stressful.

How Do You Pay For A Mortgage Broker's Services?

Like any other professional that you work with in the home buying process, you will have to pay for the services of a mortgage broker. He or she will typically charge what's listed as a loan fee or sometimes an origination fee. Before the broker starts working on your behalf, the contract negotiation will include determination of this fee. In most cases, it's a percentage of the loan that you secure, and it's typically less than what you'll pay to your real estate agent for their services.

Make sure that you know exactly how much you'll be paying as part of your agreement with the broker, because that cost is usually part of the closing costs you'll pay, and it is over and above the down payment required to secure your loan.

The more you understand about working with a mortgage broker, the easier it will be for you to decide if this type of service is right for you. Talk with a local broker at companies like Attorneys Funding Group, Inc to see if they may be able to help you with your loan search as you shop for your new home.


30 April 2018

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