A mortgage broker or agent manages the process for you by applying for loans with different lenders to find the best solution and product while negotiating terms.
In the old days, when getting a mortgage, you would probably walk into your bank and ask for a mortgage, and if you were offered a mortgage, you’d accept it – no questions asked. That was the typical process, but today it might be a mistake and cost you more.
According to a survey by MPC, 39% of first-time homebuyers have a poor understanding of what brokers do and their role in the mortgage process. Once brokers’ services are explained, the likelihood of respondents to use one jump from 36% to 59% (and even higher as understanding increases).
Here are five benefits of using a mortgage broker:
Save your time and money
- Your mortgage broker can do all the legwork for you instead of applying at several lending institutions yourself and potentially lowering your credit score.
Lower mortgage rate
- Your mortgage broker may do a lot of business with some lenders, giving them volume bonuses, which provides them with access to lower rates as a perk. Your broker can also negotiate with multiple lenders for you to get you a competitive rate that you deserve.
Free to use
- Your mortgage broker is compensated by the lender, meaning that there is no direct cost to you. The only time clients may have to pay fees is when working with a private lender or a lender who refuses to pay broker fees – your broker will tell you early on of any potential extra costs.
- While going through your mortgage process, you’re going to hear lots of information from your realtor and lawyer. Your mortgage broker is there to help you connect the dots in what can be an overwhelming process.
- Your week is always busy between juggling work, kids, pets, grocery shopping, and anything else that might present itself during the week. The best part of a mortgage broker is that they will work when convenient for you and try to make you as comfortable during the process as possible. Many brokers answer phone calls and emails ‘after hours’ to make themselves available for their clients.