The Best Reasons to Use a Mortgage Broker
There are significant reasons to use a mortgage broker when looking for the best rates and terms any time you are acquiring a new loan, or refinancing an existing one. Mortgage brokers maintain regular contact with all types of lenders. They have the ability to perform quick comparisons between mortgage rates and terms from a variety of financial lenders. In addition, brokers have the ability to steer their clients away from specific financial institutions offering onerous payment terms that are often buried deep in a mortgage contract.
What Is a Mortgage Broker?
A mortgage broker is not the source providing financing for the mortgage. Typically, a mortgage broker is an independent, licensed contractor that is directly associated with licensed, independent brokerage companies. Usually, their fees are paid through commissions connected with mortgage consumers, which are usually individuals or family seeking financing for a home purchase, or refinance of their current mortgage. Generally, they can offer a variety of financing options because they work directly with a variety of lenders and mortgage banks.
Acting as an intermediary, mortgage brokers provide a valuable service by comparison shopping for the best mortgage rates and terms, keeping your best interest in mind. Because the broker does not originate the mortgage loan, but is providing the ability to source many options, they typically have a greater range of loans available at highly competitive rates.
More Mortgage Loan Options Available
Many financial lenders offer deals exclusively to mortgage brokers because they are relied upon as the gatekeeper for continuously providing suitable clients. These types of lenders usually do not provide direct access to the consumer. In addition, financial lenders often provide negotiable special rates to the broker because of the amount of business they generate each month and/or year. As a result, brokers often have more options available than attempting to get a loan on your own.
If you have ever had a mortgage in the past, you know the dozens of fees associated with obtaining the loan. This often includes application fees, origination fees, appraisal fees and others. In many incidences, a broker can negotiate with the lender to waive a variety of fees, saving you thousands of dollars over the lifespan of the loan.
A Mortgage Broker Can Save You Time
Allowing the mortgage broker to do the heavy lifting eliminates your need to shop and call around, or research all the mortgages available in the marketplace. In addition, a broker can weed through the complicated terms offered by each financial lender, and steer you away from any confusing payment terms or high fees. In the long run, this can save you an exorbitant amount of time and energy, while still producing optimal results and possibly lower monthly payments.
Mortgage Brokers Act as a Go-Between
A mortgage broker can provide a valuable service by acting as a go-between in helping you complete the loan application process. Serving in your best interest, the broker can ensure that the lender receives all the information they need to close the loan. In fact, their motivation remains solid throughout the entire process, ensuring that the application is approved quickly and the loan processed faster, to ensure they get paid.
In addition, a mortgage brokers are familiar with the language of underwriters, making the process of approval much easier. They work as an ideal problem solver, and effortlessly handle the paperwork, resubmitting a loan package if a lender is not responding quickly.
Governmental rules and regulations keep the actions of mortgage brokers intact. By law, all terms and fees of the contract must remain completely transparent, with full disclosure of the rate being offered through the broker.
Working with a mortgage broker is important, because lenders often want the paperwork presented to them in a certain way. Lenders prefer speaking the financial lingo, and might reject the loan on problems that can easily be corrected by the broker. Once an application is rejected, it is often nearly impossible to have the error corrected or explain any misunderstanding.
The best mortgage brokers have access to many more financial lending opportunities for individuals shopping around for the best terms and mortgage rates on a new or existing home loan. They work as an ideal intermediary between the borrower and the lender to ensure the lowest rates at the best terms.