Start Looking For the Right Mortgage Broker
While most people prefer to use a lender directly when they buy a home, you can save money by working with a mortgage broker. These professionals will help you find a mortgage that suits your needs and then help you apply for it. They will also connect you with lenders that specialize in specific loan programs and rates.
They are paid a commission by both you and the lender that you choose, typically around one percent of the total loan amount.
You can ask a real estate agent to refer you to a mortgage broker or search for brokers online to see their credentials and client reviews. Be sure to look for brokers with good reputations and years of experience.
A brokers experience is a plus, as it shows theyve helped others get the right mortgage for their needs. Its not a bad idea to interview several candidates so you can make an informed choice.
When it comes to finding the right mortgage broker, there are a number of factors to consider, including their fees, the lenders they work with and how often they close on time. You can also get a feel for their personality, professionalism and responsive communication during an interview.
Check with the National Multistate Licensing System to determine whether a broker has been disciplined or suspended for financial crimes. You can also ask for referrals from other people you trust who have worked with them in the past.
The Better Business Bureau maintains a listing of complaints and ratings for brokers, so you can do some research there as well. A broker that has faced disciplinary action or been suspended in the past may not be right for you.
Rate-shop with multiple mortgage lenders to compare rates and fees. This can save borrowers thousands of dollars over the course of a loan, according to Freddie Macs research.
Mortgage broker fees vary, but some can be higher than youd pay for a loan through a bank. Those fees include application, origination and processing fees.
Brokers can also charge an upfront fee that varies by the size of the loan. This can be a great way to get a feel for the cost of working with a broker and if its worth paying extra for their services.
Its important to shop for a mortgage broker with your goals in mind, such as helping you purchase your first home or refinance your current mortgage. The best brokers arent salespeople and wont try to push you into buying a mortgage that doesnt match your budget or lifestyle.
Choosing the right broker can be a challenging process, but its an important step in getting your mortgage. Your broker should be willing to explain the mortgage process, answer your questions and walk you through any concerns you might have.
The most important thing is to find a mortgage broker you can trust and who will treat you with respect. Its a big investment, and you dont want to work with someone who isnt going to communicate clearly or value your relationship.