10 Reasons to Choose a Mortgage Broker over the Bank
Long gone are the days when the idea of buying a home was a nerve-racking process of waiting to be approved by the bank for a mortgage. Homebuyers now have a multitude of choices presented to them by professional mortgage brokers who work with their clients rather than the bank. If you are asking yourself whether to it is better to deal with the bank or a mortgage broker, you have come to the right place. Here are ten reasons why you may want to consider dealing with a broker instead.
One person, many opportunities
Mortgage brokers are professionals who are primarily freelancing agents. They play a crucial role of liaison between you, the borrower, and the lenders, the latter of which pay them a commission for bringing them clients. Therefore, they do not just work for one institution in particular, but rather they represent a variety of lenders who all have different products, conditions, and services which will allow you to find something that works for you.
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Buying a home comes with an impressive amount of paperwork, but these procedures are just part of the process and the experience of obtaining a mortgage. A mortgage broker will take the time to learn about you, understand your needs, help you to understand just exactly what you are signing, take care of sending out your application, and follow up with the lenders. Any or all hassles are taken care of, and there are no worries.
At your convenience
Although major banks seem to have been catching up over the years by providing longer banking hours, mortgage brokers have always had the advantage of not being confined to office hours. An agent will take the time to meet you when and where it is convenient, so working with a broker can turn out to be quite practical if you have a family because, let’s be honest, family trips to the bank are not always that fun.
Duking it out with your bank about your mortgage can be daunting since we are not all natural-born negotiators. Many factors come into play when negotiating a mortgage, and even though you may have done your research on the subject, this might not equip you properly to hold your position firmly at the negotiating table. Why not let the broker take care of it for you?
One of the main reasons why buyers will often seek out the services of a mortgage broker is to obtain the best rate, plain and straightforward. Because they have a foot in the door with so many lenders, brokers work to find you the best rate available for your needs. Sure, the banks offering good rates are often smaller institutions you may never have heard of, but the objective is always the same in the end – getting the best deal for you. And as always, the final decision is yours.
Brokers are valuable partners for buyers who may be in particular situations, such as self-employment or a flawed credit history. A broker has access to private funds and specialized institutions – they can help to connect their clients with their particular needs and associate them with establishments who are ready to take them on board.
Mortgage brokers are financial professionals who are licensed, though this varies from province to province. To obtain their licenses, they need to go through classes, as well as undergo exams, training, and apprenticeships. The broker sitting in front of you will have gone through all these different steps to practice as a licensed agent. The bonus is that a broker is more likely to take the time to teach you a few things along the way, sharing knowledge and tips that many bankers do not necessarily have the time or inclination to do.
You should not have to pay a fee when dealing with a mortgage broker, as they are paid a commission from the lender with whom they are arranging your contract. This fee is based on the type and length of mortgage you will sign – the longer you take to pay off your mortgage, the more the broker will earn.
Strategize and Planning
As mentioned above, a broker will take the time to analyze your financial situation in order to obtain the right products for you, but they can also help you to strategize so that you could pay off your mortgage sooner. Planning so far ahead might seem strange, but considering the investment, taking the time to look at the bigger picture and having a professional accompany you through this process is worth the effort even if it may appear complicated.
Making Real Connections
Though it is not a financial factor, having someone sitting in your kitchen or living room and listening to your needs makes all the difference. Mortgage brokers have that liberty – they establish a real connection and relationship with their clients. And of course, there is a plus for them – for example, you might refer them to friends and family – and as a plus for you, you will learn something new as well as feel empowered and more confident. Finding the right broker can be tricky, so do not sign on with the first one you meet. It is worth taking your time to meet a few and see which one you feel truly understands your needs because with so many important decisions ahead, you want to be sure you have the right person supporting you.