To address the question of whether a mortgage broker is right for you, its important to first understand what a broker does.
In short: Think of a mortgage broker as a navigator between you and potential lenders. A brokers main duty is to market you as an applicant, to various lenders and find you the best possible loan product for your unique financial situation. The biggest difference between a broker than a bank or credit union is that a broker will shows you multiple options, whereas a bank or credit union will only show you their limited loan products limited to what they have in house. A broker looks at all the options and finds you the most competitive loan available.
A good way to think of a broker, is to think of us as your own personal talent scout. Its my job to present your information to mortgage companies and collect their "bids" for your loan. This is similar to how an employment agency would market your professional assets to a potential employer - except that we market your ability to repay the loan, using the info we collect in your loan application process.
Once you settle on a loan and a lender that works best for you, your mortgage broker will collaborate with the bank’s underwriting department, the closing agent (usually the title company), and your real estate agent to keep the transaction running smoothly through closing day.
One major benefit to you as a buyer is that using a mortgage broker is totally free to you as a buyer. A mortgage broker is paid by the lender in return for bring your business to them. Lenders understand that loan candidate could not possibly shop all their own options available. Lenders pay a flat percentage to the broker that is not tied to the type of loan or the interest rate you as a client. A broker will always provide you the best interest rate available to you.
You’ll also save time by using a mortgage broker; it can take hours to apply for different loans, and then there’s the back-and-forth communication involved in underwriting the loan and ensuring the transaction stays on track. A mortgage broker can save you the hassle of managing all those daunting details.
The first step of entering the real estate market, is to talk with your broker about getting pre-approved. During pre-approval you are asked to provide basic information such as pay stubs, W-2's, employment history and fill out a loan application. With this info we see how much you can borrow and give you a range to provide to your realtor for houses you're qualified to purchase. Typically you choose a purchase range based on what you are comfortable with spending each month for housing not the upper limit of what you may be qualified for.
I'm always glad to talk to anyone thinking of buying or refinancing a home. Hopefully this brief overview will help you along your way. Please call me if you would like to get your process started.
