Buying a house can be a daunting task, and for a first time borrower you might not know all the ins and outs that are involved in taking out a home loan. It’s usually more beneficial to get home through a mortgage broker than directly through a lender or bank. Mortgage brokers are the professionals that match your needs with a home loan from a selection of lenders. But it’s important to choose the right broker – one who is knowledgeable, accredited, and covers a wide range of lenders. Here are 5 useful tips for you to find the right mortgage broker.
- BEGIN YOUR SEARCH WITH REFERRALS
Start your search for a mortgage broker by getting recommendations from friends, real estate agents, colleagues, and other homeowners. Your real estate agent will likely have acquaintances in mortgage lending that they have been working with for a long time, or you colleagues might be in a similar financial situation and have advice on which broker to seek out. It will be beneficial to your search to ask as many others for recommendations as possible. This stage is about collecting information to make the most informed decision possible.
2. COMMUNICATION, CLARITY AND COURTESY
Dealing with financial matters can be complicated and frustrating and often scary for people who have not been through the home loan process before. A good broker will be able to effectively communicate complex mathematical calculations and financial concepts to his or her borrowers, and be patient when their borrowers have questions. Also, when dealing with real estate matters, time is one of the most important factors to be remembered. If you find it difficult to get a hold of your mortgage representative, or get them to commit to a time to meet, these are red flags.
3. EVALUATE THE FEES, RATES AND OTHER POINTS
Mortgage brokers connect lenders with homeowners and make a profit from this connection. This profit can come in the form of points, generally attributed to one percent per point of your mortgage rate, or commission fees. It is important to inquire about fees and points to make sure that you are getting the best deal for you and not just the broker. A sign of a good broker is the amount of options they give you. Avoid brokers who only give one option or are pressuring you to commit.
4. EVALUATE MULTIPLE BROKERS TO CHOOSE THE BEST
Once you have referrals, reviews, and recommendations, call around to schedule a few interviews with potential brokers. Try to schedule these interviews as close together as possible, ideally all in the same week. Make a list of questions you would like to ask and gather important information such as how many years they’ve been in the industry, references from past clients, or typical closing times.
5. FIND THE POTENTIAL BROKER YOU CAN WORK WITH AGAIN
If you’re a first time buyer working with a mortgage broker, chances are pretty high that you would use your broker’s services again in the future. It depends on how good an experience you have working with the broker and if you can see yourself working with this person for not just this loan, but for any or all home financing needs in the future.