Buying a house is one of the biggest decisions you will make in your entire life. And the same goes for choosing a mortgage loan. Hence, you should look for the best terms and loans that are best suited for you.
Looking for the best mortgage can be time-consuming and risky, especially if you’re not well-versed for it. This is where a good mortgage broker comes to the picture. A good mortgage broker will help you look for the best mortgage deal from a wide array of choices. Here are tips on how to find a mortgage broker.
But first, what is a mortgage broker?
A mortgage broker is a financial adviser that you hire to help you find the right home loan for you. His or her job is to compare home loans from different mortgage providers, like banks or other lending institutions, according to your needs and financial situation.
Once you find the best mortgage plan, the mortgage broker will process everything for you. A good broker will guide you in every step of the process and will help you get approved as quickly as possible.
Do some research.
It is essential to be prepared before looking for a mortgage broker. Search for potential brokers in your area. If you are living in the Peel region, then look for a broker in the Peel region. It is convenient to have a broker near the place where you want to buy a property. Once you have a list, contact each broker to know the deals that they can offer you.
You can ask your friends or family who purchased a home before you. These people have first-hand reviews of their brokers, and their brokers might be your next broker. Aside from reviews from people you know, you can also check the online reviews of the potential brokers you found. Reading reviews will give you an insight on who to choose as your mortgage broker.
It is also essential to search for different loans and mortgages. Look for probable loans online to get a clear idea of what type of mortgage or loan you want. By doing this, you can quickly assess the recommendations of the broker.
Know how they get paid.
Most brokers do not charge per service that they give you. Their financial advice is free. They are usually paid on commission basis by the bank or lending facilities that they choose for you. There are two types of commission: upfront commission and trail commission.
The upfront commission is when the broker receives a percentage of the total value of the loan. This means that the larger is the amount of the loan, the larger would be the value that the broker will receive.
A tip is to be wary when the broker recommends a loan that has a high value. Trail commission, on the other hand, is when the broker continues to receive a percentage of the mortgage over the life of the loan.
Check their lending panel.
Mortgage brokers are restricted on the list of lending institutions and banks that they can access and transact with. This list is called the lending panel. The lending panel will show more about the work and experience of the mortgage broker.
If the broker has reputable institutions in their list, then it means that your mortgage broker is reliable as well, since these institutions trust this broker. If not, then you might miss some good mortgage deals.
Ask your potential broker on the list of banks and lending institutions that they deal with. The ideal number of institutions that they should recommend to you is 10. If they give you only a short lending panel, then this is a red flag, meaning that they only have a short range of institutions to choose from and that you might be limiting your options.
Figure out what you want and need.
As a borrower, you should know what house you want and need that would also correspond with your financial status. Assess whether you want a home in the suburbs or the middle of the city. You should also assess your financial situation. By knowing these things, it would be easier for you to know who your broker should be.
Concerning the lending panel, you should take note that having a bigger lending panel does not mean that they also have excellent service. It will always boil down to what you need and want. Make sure to ask your potential broker an offer in writing for you to assess whether what he or she offers is right for you.
Takeaway
Having a mortgage broker helps find the best mortgage deal when purchasing a home. Finding a good one can be tricky, but with the tips mentioned above, it will surely be easier to look for one who will help you in finding the best mortgage deal suited for your needs and financial status.
