Before you head out to your local bank branch, you should consider meeting with a mortgage broker first.  Mortgage professionals are another way for you to get the loan of your dreams, and there are plenty of advantages attached to their services. 

To help you get the best rates and advice, here are all the reasons why you should use a mortgage broker.

Top Reasons Why You Should Consult a Mortgage Broker

A mortgage broker is an intermediary between a lending institution and an individual known as the lender and borrower, respectively.

Basically, he/she is an insurance broker from an insurance company. But, instead of insurance, they manage all your mortgage needs.

1. Competitive Mortgage Rates

Compared to banks that can only offer their own products, a mortgage broker has a wide arsenal of options to choose from. 

person using calculator

These include:

Mortgage brokers work with multiple direct lenders, which means they have all sorts of connections in the money-lending industry―a huge plus if you want to get the most competitive mortgage rate/ interest rate.

Depending on how good and well-connected your broker is, he/she can get you better deals at superior rates since some lenders only work exclusively with certain mortgage brokers.

2. Low Consultation Fees

Forget about paying those large fees in banks, using a mortgage broker to handle your mortgages enables low consultation fees.

Mortgage brokers are paid either through lender’s commissions or borrower’s application fees. Typically, lender commissions range from 0.50% to 2.75% of the total amount paid after closing, while borrower’s fees are at a rate of 1% to 2% of the total amount.

discussion with client

Not bad when you compare it to the bank’s penalty charges and interest rates.

(Want to settle your current home obligations? Why not consider signing up for the home buyers’ plan form to help you with your finances) 

3. Professional and Up-to-Date Advice

Like a real estate agent, a mortgage professional has deep knowledge of how the market place works, therefore offering valuable insights.

Mortgage professionals seek out the best lender package for your financing situation and advise you against certain lenders with onerous payment terms, which can save you from financing troubles.

4. Safeguarding Credit Score

Banks require huge collateral in exchange for your mortgages’ approval, so your home application won’t get approved right away, especially if you have a BAD credit score.

lady talking to her client

Having a broker manage all your payments protects your credit score from potentially lowering further. In fact, you might even be able to waive off a portion of the mortgage rates. This will save you thousands of bucks.

5. Expertise and Experience

Licensed mortgage professionals are experts in mortgage financing and have a ton of product knowledge and expertise.

These provide you with the best mortgage option and efficient management services.

6. Immediate Approval

You’d have better chances of getting your home loans approved if you’re working with a mortgage broker. Why? Because mortgage brokers know lenders with the fastest approval times and lowest rates.

hands holding a clipboard

And, they help you prepare all the requirements, including the mortgage proposal and the re-payment options to the lender.

Part of the brokers’ job description is to collect all proper documentation for mortgage submissions such as:

Brokers oversee the completion of your mortgage approval process from start to finish so that you can avoid secondary applications to the credit bureau inquiries.

7. Representation

Mortgage brokers seek out the best mortgage options and represent you, the lender, in different business transactions.

female office worker smiling

Settling your mortgage involves paying fees. A licensed broker may sign papers on your behalf and take care of the following:

Gone are the days where you had to apply for mortgages all by yourselfWorking with one saves you a lot of stress, time, and money.

(Dreaming of buying a home in Canada? Then, you should understand what high-ratio mortgage is

FAQs

What Are the Benefits of Using a Mortgage Broker?

The benefits of using a mortgage are competitive rates, secured credit score, among others. Hiring a broker saves you time and money because they simplify the entire mortgage process for you by assessing borrowers, searching for lenders, preparing pre-approvals, annd making the final arrangements.

What Are the Disadvantages of Using a Mortgage Broker?

The disadvantages of using a mortgage broker is that a broker’s interest may not always align with yours. Of course, mortgage financing set by brokers has its fair share of disadvantages. As a borrower, your goal is to find the most affordable rates, whereas a mortgage broker’s goal is to get you to spend more. The best way to deal with the problem is to find the right broker for you.

Conclusion

Why use a mortgage broker? They have better rates, better advice, and less hassle. Our expert team recommend brokers if you want access to more lenders in the market and if you want to protect your credit score [1].

To understand the real estate industry in Canada, you can also check these pages below: 

Foster Mendez

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