What To Do BEFORE Sitting Down with a Mortgage Broker
Hi there! Amanda here, the Project Manager and CMO of Porteus & Son Builders! I want to start this blog post by telling you a little about our past before Porteus & Son Builders. So, growing up, my father, the CEO, had two jobs. He was a New York State Trooper and owned a contracting company called Mid-Westchester Landscaping. They did more than just landscaping, but landscaping is how they started out.
After my father retired, he got his private investigation license and began doing private investigation work, and when I got out of college, I would work with him part-time on some of the cases he handled. We value the importance of investigating and asking questions, especially when someone will be taking documents containing your personal information.
Hiring a middle person isn't something anyone likes doing, whether the situation is about a mortgage or otherwise, but that's what mortgage brokers are: go-betweens. Describing them this way is often an unfair characterization, so we suggest a few things before you decide to sit down with any brokers.
Investigate
Investigate their websites and reviews to narrow the field to brokers with consistently positive customer service reviews.
Listen
Listening before asking questions will give you a good idea of whom you could forge a better connection with.
Question Everything
These are the top five questions we think you should consider when you're sitting down with a broker:
How are they paid?
Transparency during the loan process is most home buyers' primary concern. Mortgage brokers typically get paid on closed loans, and their fee is often embedded in the lender loan origination fee. Make sure this fee isn't a large chunk of change.
When the sale is closed, they receive a lender commission wrapped up in the closing costs — about 2-3% of the total. The broker gets a portion of this, depending on who the lender is.
2. What type of loan would work best for you?
Mortgage brokers have access to an extensive list of lenders. Brokers research for you and negotiate terms to find the most beneficial agreement. You want a broker whose next step is to find out more about you before suggesting a loan type.
You want a broker who asks many questions about your income, down payment, and plans. You want to know the broker is considering what is best for you.
3. What are their hours?
Working with a mortgage broker usually means not having to deal with conventional banking hours. Make sure to find out what hours they work, though, for this reason.
4. Can they show you the breakdown for different down payment amounts?
Ask the brokers if they could give an itemization of the interest rate and fees for your house budget so you can compare the costs between, for example, putting 5% down and 20% down. Having a printout or an email from them with the breakdown is helpful when you are trying to decide between brokers.
5. Would they offer a rate match?
We don't suggest making any commitments during the days you initially interview brokers. We also recommend you investigate a few other lenders and compare their offers to what the brokers provided.
Once you have made this comparison, ask the brokers if they would offer a rate match. Some will, as long as you have an official offer.
In the two days following your meetings with each of the brokers you speak with (we strongly suggest meeting with at least two), look for open communication and speedy replies.
The communication style should be relevant to you. Depending on your lifestyle, you may prefer one broker's communication style over another's.
Settling on a Broker
Feeling comfortable with someone who is handling such a large portion of your future is something we think is essential. A significant trust factor comes into play when someone takes your loan process and documents with sensitive information on them. Asking many questions is the only way to get what you want and be happy!
