While many buyers partner with a real estate agent to help them find their home, it can be a good idea to use a mortgage broker as well. As Investopedia notes, mortgage brokers help buyers find the financing to buy the property, acting as a middleman who matches mortgage lenders with borrowers.
If you’re refinancing or purchasing a home, they can help you find the best possible mortgage for your situation, which can take some of the stress out of the process. They can help with everything from filling out the application, securing the lowest fees and a good interest rate, to closing the loan on time. Having a mortgage broker who can help you navigate the market can be a very advantageous move that brings many benefits, especially for those buying a home for the first time.
The Best Deal
The odds of getting the best deal possible increase significantly when you use a mortgage broker as they can offer a wide array of mortgage loans from many different lenders, and the broker also represents your best interests rather than that of the lending institution. Those who are highly experienced are likely to have developed relationships in the industry to ensure you’ll get the best interest rate and loan product for your needs. Your broker will interview you to learn what your particular requirements are and your short- and long-term goals.
If your situation demands more than just the simple use of a 30-year or 15-year loan or an adjustable-rate mortgage (ARM), the mortgage broker will be more knowledgeable about innovative strategies that can help you get what you’re looking for. Those who have a so-so credit history or want to buy a more unusual property can especially benefit as a mortgage broker can find a lender more flexible with credit scores or specializes in certain types of properties.
When you have a mortgage broker, you’ll only have to complete one application rather than having to fill out an application for every lender. As the broker does all the legwork, like researching various loan products, their rates, and fees from the hundreds of options available, as well as negotiating for you, offering even more time savings.
The broker can also provide a formal comparison of the loans they recommend and guide you to the details, helping you understand the cost differences, points, rates, and closing costs. Before you sign the bottom line, they’ll ensure that you fully understand all paperwork, terms and conditions.
Free, Personalized Service
The majority of mortgage brokers earn their money on commissions that the lender pays and provide services to homebuyers free of charge. Their service is usually more personalized, too, helping to smooth out any potential issues, be available to you for advice and questions throughout the closing process, and more.
Of course, you’ll want to be sure the broker you choose has the experience and qualifications necessary to get the best service possible. Referrals from your real estate agent, an accountant, attorney, or financial planner can be a great source.