Getting a loan for your home means finding the right mortgage lender and loan, but instead of trying to do it on your own, consider hiring a mortgage broker. There are many reasons a mortgage broker can help you get the best loan, so check out these three benefits of hiring a mortgage broker for your first home loan.
They Work for You Not the Lender
Banks and other lenders hire loan officers to deal with customers looking for home, auto and personal loans. They have the knowledge and skills needed to help you choose a loan for your needs. However, they are limited in that they can't look outside their employer and they may not be able to get you a lower interest rate. A mortgage broker doesn't work for the bank. They work for you, giving them the freedom to look at any lender for the perfect loan. Of course, they still need to get paid. Their payment is usually about one to two percent of the total loan amount. The payment is usually paid by you or the lender.
They Are Trustworthy
In the past, there were fewer regulations on mortgage brokers, making it possible for them to get paid twice (once from you and once from the lender). Similarly, they could boost their payment by pushing you into a bigger loan than you wanted. Last, some even got financial rewards for directing customers to specific lenders. However, thanks to the Dodd-Frank Act, which protects clients using mortgage brokers, they can no longer get paid twice or gain financial reward by choosing a higher loan or specific lender. Therefore, you can trust a mortgage broker because they will need to follow the legal guidelines in order to protect their business and investment.
Lenders Prefer to Work With Brokers
The last benefit of getting a mortgage broker is that lenders usually prefer dealing with brokers instead of clients. This is largely due to the fact that mortgage brokers and lenders are in the same field. The mortgage broker won't waste their time trying to get an impossible interest rate, and they are more likely to understand all the technical jargon. Some lenders only work with brokers, taking them and their loans off the table if you don't have a broker. This, however, also benefits you because the broker has the skills and relationship with the lender to negotiate fair loan terms for you.
Finding the perfect home is only part of the home-buying process. You also need to find the right home loan to pay for your new home, and a mortgage broker can help. For more information about home loans, contact a mortgage broker or lender in your area today.