Tips for Working with Mortgage Brokers

Mortgage brokers have industry connections. Through those connections, they can access products you, as a general consumer, can’t. Brokers offer a wider variety of mortgages than traditional lenders, including loans for borrowers with poor credit.

Traditional lenders include institutions like banks, mortgage companies, and credit unions. Unlike the deals brokers get, customers can only access retail mortgage loans at retail rates. Again, these rates are much higher than what a broker can find for you.

With a mortgage broker, you’re also saving time and energy. Your broker will do all the loan shopping, application filing, and rate comparisons for you. All you have to do is choose the lending product that best suits your needs. 

Of course, a mortgage broker’s services don’t come for free. You’ll pay a small origination fee when you close the deal on your new home. This fee is usually a percentage of the wholesale mortgage rate to keep your costs low. 

While it’s true that you won’t have to pay the brokerage fee with a traditional lender, it will cost you in time. You’ll have to shop and apply for the different home loan products on the market. Then, you’ll have to compare each loan before making a final decision.

Compared to the traditional lending model, going with a broker will save you countless hours and dollars on your mortgage. Yet, not all brokers are created equal. Keep reading to learn some tips and tricks to finding and working with mortgage brokers.

These days, a broker is a borrower’s number one point of contact for a home loan. As such, the government has placed regulations on the mortgage brokerage industry to combat predatory lending practices.

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