How To Choose Your Mortgage Broker
May 22, 2020 brooklyn mortgage broker
A mortgage broker is someone who will work as an intermediary between you and a lender. They don’t work for the lender but instead will ensure they work to find you the best possible rate and terms. Typically, you’ll meet to go over your finances, income, credit score, and other key variables. Then, they’ll help you consider your options.
Their services aren’t free, however, and their payment may be paid either by the lender or by the borrower. If you pay the broker, the fee is typically about 1% of the loan amount (though this does vary). If the lender pays the broker, that can sometimes result in the broker favoring that lender, decreasing your options and sometimes ensuring you don’t get the best deal. You can ask your broker up front how they are paid.
Aside from that, some good things to ask your potential broker include:
-How many lenders do you work with?
-What are my chances of getting a good loan?
-What can you offer me that is worth paying you and not doing this on my own?
-Can you put me in touch with any former clients?
Your broker shouldn’t be thrown by any of these questions and should be able to answer them without hedging. It’s also important to note that some people choose to go the no-broker route. The pro is that you aren’t adding the additional broker expense but the con is that you may not get the best deal and the process can be time-consuming. It all depends on your comfort level.
If you’d like some more information, we’re joined by Mortgage Broker Lisa Yountchi in this recent Buying Into Brooklyn presentation.