Mortgage Broker: How One Can Help You

A house is among the biggest purchases you will make, so you should ensure that you can live with your decisions. A mortgage broker acts as the intermediary between the lender and borrower, and he can help you find the best deal available. Here is some information to help you decide if you need to call one.

Using their expertise and contacts with the different lending institutions they deal with, a mortgage broker can definitely save you both time and money. If you are a first-time homebuyer, you will most likely have many questions regarding the procedure, and having a loan professional working for you will help allay any fears you may have. This is especially true if you have a troubled credit history or an unusual financial situation, such as being self-employed or in sales, and have to use a nonconventional lender. Because he will receive a commission from the lender at the close of escrow, this service is free for borrowers. In addition, since he will only perform a credit check once, this will protect your credit score, which can be damaged by multiple checks from different lenders.

When you meet with a potential broker, feel free to ask them any questions you may have regarding their qualifications and experience. You should expect a good professional to help determine the percentage of the property value you can borrow and the types of home loans available, as well as which ones will suit your financial needs the best. Depending on the terms of your loan, you may need to pay private mortgage insurance, which will add to your monthly payment amount, and he will have more information about that. Some lenders have underwriting conditions that are more favorable to borrowers, which he should be aware of so he can get you the best deal possible. Of course, when you are finally ready to sign on the dotted line, you need to be certain that the details of your loan were fully explained to you, such as the rate you will be paying, the length of the term, and which lender you will be using.

You need to make sure you find a broker with a good reputation, as there have been some shady ones in the past. Try to avoid any who seem overly aggressive or prone to exaggeration, such as advertising extremely low interest rates or trying to get you to lock in to a deal before you are ready. Another indication that you need to go elsewhere is if he tries to steer you into a rate that is not ideal for you, such as a variable interest rate instead of the fixed rate that you initially wanted. Although finding a competent professional can seem like a daunting task, especially if this is your first property, start by asking your friends and relatives who are in real estate or finance to see if they can recommend someone. You can also use the internet to find one, at which time you can also verify his credentials with your state licensing board.

Using a mortgage broker is a convenience factor that can pay off for you financially, provided you do your homework. Talk to one in your town to see what he has to offer.