Finding a good mortgage broker in your area gives you a local expert on your side through one of the biggest financial decisions you will likely make in your lifetime. Finding a mortgage broker, a licensed and independent professionals, who are able to shop multiple lenders, which gives you access to more good mortgage options than a bank can offer. This allows you to find a more affordable and easier mortgage that is tailored to your home financing needs. Here are some tips on how to find a good mortgage broker.
What Is A Mortgage Broker?
Finding the right mortgage can be just as important as selecting the right house because you will be paying off your loan for many years in the future. Getting the best rates and lowest fees can be a daunting task, which is why many people enlist the help and go through the process of finding a good mortgage broker.
A mortgage broker is a person who shops for a home loan or mortgage on your behalf. After learning about your circumstances, such as your income, credit, down payment and other information, they will search for the best deal on a mortgage loan for you.
While banks only offer you the loan products from their own portfolio, mortgage brokers work with several banks and lenders, giving you access to a wider range of options. They can also explain the pros and cons of the various types of loans available to you and help you make a wise decision.
How Can I Find A Good Mortgage Broker?
Before you start your search to find a mortgage broker, it is a good idea to ensure your credit score is the best it can be. You will also want to have some background knowledge of how the loan process works before you start meeting with prospective brokers.
Work On Your Credit Score
To qualify to buy a home, you will need to meet credit and income criteria signaling to mortgage providers that you are capable of repaying your loan. If you have a low credit score, it indicates that lending to you is risky. In addition to making it harder to get approved, you may be given a higher interest rate. If you have a higher credit score, however, and a history of making payments on time, you will be in a better position to negotiate for better rates.
The first step to elevating your credit score is ensuring that your credit reports are accurate and do not contain any errors. You can ask each of the three major credit bureaus – TransUnion, Experian, and Equifax – for a free copy of your credit report once every 12 months. If you notice any mistakes, take the necessary steps to resolve them immediately.
Then, work on paying off high-interest debts and reducing your overall debt level as quickly as you can. This will improve your debt-to-income ratio, which is another factor considered by mortgage providers.
Understand Your Options
An important component of finding the best mortgage broker is understanding the terminology they use. Although mortgage brokers are happy to explain your options to you in plain language, carrying out some research upfront can help you understand what they are talking about and spot potential dishonesty.
This is also a good way of dispelling any myths about the process that could influence your choices. For example, the idea that you need to put a down payment of 20 percent on a home is now outdated as many lenders now offer conventional loans with much lower down payments – although this may come with a higher interest rate.
Ask For Referrals
Referrals are one of the best ways to find a good mortgage broker. If someone whose judgment you trust has recently purchased a home, ask them for the name of their mortgage broker and whether they had a good experience. This can help guide you toward brokers you might want to work with as well as those you should avoid.
If you do not have any friends or relatives who have recently applied for a home loan, consider asking your real estate agent if they can suggest any mortgage brokers. Agents often meet brokers at closings and may be able to make a recommendation. Your agent has a vested interest in recommending a good broker because if the broker is unable to close the loan in a timely manner, the sale may not go through at all and the agent could lose their commission.
Consider Online Reviews
You can also try searching for a good broker online. Check reviews on several review platforms to get an idea of how helpful and communicative the broker is.
Interview Potential Brokers
Once you have narrowed your list down to a handful of brokers, consider interviewing them in person or by phone to guide your decision. Find out who their typical clients are and whether they normally deal with the type of loan you are going to need. You also want to ensure that they are licensed.
In addition, these initial conversations can help you gauge whether or not you will feel comfortable working with them on such a major financial transaction.
Find Your Mortgage Broker At MyLendingPal
If you are looking for a mortgage, get in touch with the mortgage brokers at MyLendingPal. Their experienced brokers have the knowledge, insight and connections needed to help you obtain the right loan for your circumstances.
