Pros and Cons of Using Mortgage Broker Services

Broker having a discussion with a young couple who are sitting listening to her with serious attentive expressions

Many home buyers recruit the services of a mortgage broker when shopping for a mortgage. An experienced and knowledgeable mortgage broker can help you find the right mortgage, but there are advantages and disadvantage to consider before committing.

Advantages

  • Saves you the Legwork – Mortgage brokers have frequent contact with a vast array of lenders, some you may not even know about. A broker will save you the time and energy having to call up dozens of lenders comparing terms and rates on your own.
  • Brokers Have More Access – There are some lenders that you may not be able to call directly as they will only work with mortgage brokers. A broker could also be able to get special rates from lenders depending on the volume of business they generate.
  • You May Have Some Fees – There can be many different fees involved in a new mortgage such as application fees, appraisal fees, or origination fees. Sometimes mortgage brokers can get lender to waive some or all fees and that can save you hundreds to thousands of dollars.

Disadvantages

  • Brokers’ Interests Might not Match Yours – You are in it for the long haul so your ultimate goal should be to find a mortgage with affordable interest rate and low fees. A mortgage broker will often get paid a fee for bringing the lender business. Fees can be based on the amount of the mortgage; therefore the broker’s goal may be to get you the mortgage that gets them the most compensation.
  • You Might not be Getting the Best Deal – Sometimes a lender may offer buyers precisely the same terms and rates that they offer brokers and sometimes even better. It doesn’t hurt to shop around on your own to see if your broker is really getting you a good deal.
  • Brokers Often do not Guarantee Estimates – Broker’s often use the term “good faith estimate” when presenting you with the lender’s offer. The broker believes that these offers will mirror what the final terms of the deal are. The lender might change the terms based on your application in some cases, and this may cause you to pay higher rates or extra fees.

If you choose to use the services of a mortgage broker, work with a reliable one with solid references that can guarantee their loan estimates.

Discover Mortgage Products That Can Help You

Mortgages are valuable loan opportunities that can help you get into the home you have always wanted. In fact, virtually everyone who owns a home achieves this goal with the help of a mortgage. This means that the process of applying for a mortgage is just as important as the process of buying a home; just as much care and deliberation should be taken when making both decisions. Altius Mortgage has helped clients discover the mortgage solutions that fit their goals and financial lifestyles perfectly. Here are a few things to keep in mind when determining which mortgage services are right for you.

What Distinguishes the Right Mortgage?

The general guideline for determining how much home you can afford is to take your annual income and multiply it by two or three. This gives you a basic idea of the price range you can reasonably afford. However, do not begin selecting mortgages just based on this amount. There are other things that can affect your borrowing power, such as:

  • Current debts and savings
  • Your personal employment history
  • Your credit history

Making a down payment is a very good idea and it can make fulfilling the terms of your mortgage considerably simpler. While down payments are not necessarily a required part of getting a mortgage, this is a sound way to begin life as a home owner.

Based on these and other criteria, some mortgage services may be more or less well-suited to your particular needs. That will help you eliminate some options from consideration.

Help for Prospective Home Owners

Upon learning what criteria borrowers must meet to qualify for good mortgages, some prospective home buyers might think that home ownership is entirely out of reach. There are actually several programs that can help people achieve this dream. You may be more qualified than you realize. The best way to learn if these programs could help you is to talk with an associate at Altius Mortgage.