One of the most common questions people ask when they are going through the mortgage process for the first time is “Why should I use a mortgage broker?” And that makes a lot of sense, people are usually more comfortable working with something they’re familiar with. That’s why a lot of people assume the bank is their only option when it comes to their mortgage.
From the outside the mortgage industry can be dense and confusing. There is a lot of jargon and terms a person would rarely encounter in their daily life and the distinctions between a broker and a bank are not obvious right away.
To answer the question of why you should use a mortgage broker over a bank, you have to understand what a mortgage broker is and what a mortgage broker isn’t.
What is a mortgage broker
A mortgage broker is a licensed mortgage professional that focuses on finding you the best mortgage product for your unique situation. We spend our days working with a variety of lenders and helping clients get the financing they need to purchase their first home, refinance at a better interest rate, and generally improve their financial situation.
The most important skill a mortgage broker (or agent!) can have is the ability and willingness to learn. The industry is always changing, there are hundreds of lenders on the market and each of them offer products geared towards a number of circumstances. A big part of a mortgage broker’s job is to stay up to date with new regulations and new mortgage products, so that they can then offer their clients the best advice and service they can.
How do mortgage brokers work
At Ardent Mortgages, we consider our role a combination of things.
We are negotiators, we work on our client’s behalf to get the best interest rates and mortgage products on the market.
We are coaches, we work with our clients to help them achieve their financial goals and improve their credit.
We are consultants, we offer advice and options to our clients. Ultimately the client has a problem and we try to find the best solution to that problem.
To do that we do the research and build relationships with lenders all across the financial spectrum, so that no matter the situation a borrower comes to us with we can help.
The difference between a mortgage broker and bank
The main difference between a mortgage brokerage like Ardent Mortgages and working with a mortgage specialist from your bank is a bank can only offer you one solution. And that’s whatever the bank is currently offering. Working with a bank limits you to whatever products the bank is selling, whether or not they are the right fit for your situation.
A mortgage broker works with a number of different lenders to find you the product that’s right for you. Because of this free market dynamic, those lenders compete with each other to offer the best rates, which is why a mortgage broker can usually get you a better rate than your bank can.
But a mortgage broker offers much more than just a superior interest rate. We also offer advice and guidance to our clients as well.
How to find a mortgage broker
Since you’re reading this article you’ve already found one! Ardent Mortgages is ready and willing to serve you in your search for the right mortgage solution, all you have to do is fill out our quick 90 second application and one of our expert mortgage agents will reach out to you to get started.
How to choose a mortgage broker
For an in depth answer to this question read 3 Common Mistakes To Avoid When Choosing A Mortgage Broker, but simply put the most important things to look for in a mortgage broker are honesty, transparency, and connection.
The best mortgage brokers will show you what your financial situation looks like, how to improve it, and then walk you through the steps so you can make it a reality. They should also be transparent about what solution they are working on, why it makes the most sense for you, and then keep you informed as to the progress of the deal. These are all things that we prioritize at Ardent Mortgages when working with our clients.
Mortgage broker fees
This is probably the biggest sticking point for borrowers. “What are the fees?” they say. It’s a fair question, and for many of our clients the fees are zero.
For those clients, the lender pays the mortgage broker a finder’s fee as a thanks for bringing them the business. So not only does the client get the best mortgage at the best interest rate, there is no extra charge to work with us.
For the rest of our clients, the answer is it depends on the complexity of the deal. If we do charge a fee, we always make an effort to build it into the deal itself so the borrower isn’t out of pocket. Especially for mortgage refinances.
And we always tell our clients that if the deal doesn’t make financial sense, we won’t do the deal. We will never pressure our clients into a mortgage that doesn’t improve their situation in order to make a commission.
Our philosophy is that it’s always better to consider the long term relationship and do what’s best for the client, no matter what. We want to work with our clients for life, we hope that when you work with Ardent Mortgages that you don’t even consider using another brokerage or lender the next time your mortgage comes up for renewal, and to do that we need to serve you at the highest level.
I hoped this article answered your question of whether or not you should work with a mortgage broker. If you’re ready to refinance your mortgage or purchase your first home, we would love the opportunity to work with you. Click this link to fill out our short 90 second application and we’ll start looking for the best mortgage for you.