You have been searching for that dream home and you have eventually found it. The hunt begins for that elusive perfect mortgage. The home loan brokers in will guide you through the process from beginning to end and arm you with loan to make your dreams a reality.
Firstly you need to understand what a mortgage broker is. He is basically a middle man between you as the purchaser and the financial institutions or lenders. It is the mortgage brokers job to seek out the best deals for you with the lowest rates in a loan that is appropriate to your needs. They are licensed individuals who are regulated financial professionals and have contacts within a number of institutions with whom they work regularly. They do all the hard work of collecting documentation, filling in paperwork and applying on your behalf. This is all done in a very short period of time. Once you have decided on the offer you wish to take up, the mortgage broker will communicate with the underwriting department to get the deal finalized and the keys to your home in your hands.
In most cases a mortgage broker charges a fee for his services. This fee is usually about 1% of the total loan amount and is paid by the lender when the deal is finalized. There are times that the broker will negotiate a no-cost loan so that you are saved some upfront costs. The broker is only paid when the loan is closed, this may however result in higher interest rates for you and this may cost you more over the loan period than any upfront fee would have cost you.
The benefits of a mortgage broker speak for themselves. They save you time and money and do all the hard work for you for a small fee. Some financiers only work with mortgage brokers and they have relationships built within lending companies because of the work they do daily. This is the reason you may receive discounted rates.
The disadvantages are also evident. You have to pay an origination fee which is 1% of your loan amount. You may not have access to certain lenders who don’t deal with mortgage brokers and may lose out on potential better deals.
Choosing a mortgage broker is pretty much common sense. References, research and interview. These are the keys to success. You must feel comfortable and confident in the choice you make and believe without a doubt that they will get the best deal for you.