If you are deciding to buy your dream house, then hiring a mortgage broker is a better option. However, getting a mortgage will save your time, money and help you to grab the best deal that fits in your budget. A first-time home buyer can hire a mortgage broker to find the best terms and rates.
Moreover, brokers will also negotiate with the lenders on your behalf. Additionally, they will handle all the paperwork between you and the seller. So it is vital to hire a broker if you are deciding to buy a house. With this article, we will discuss both advantages and disadvantages of an aurora mortgage broker.
What is the work of a mortgage broker?
A mortgage broker creates a connection between borrower and lender. He will help you to connect with the lender and find out the best deal that fits in your financial situation and needs. Moreover, a mortgage broker will also collect documents from a borrower and passes to the lender.
And at closing, brokers earn a commission from you and lender. However, the mortgage broker will determine the ideal loan amount and loan to value ratio and then submit it to the lender for approval. The broker is in communication with both borrower and lender during the entire transaction.
However, the broker is responsible for paying all parts of fees and gets paid when the loan transaction completes. So it is vital to work with an individual who provides you with the best deal and whom you can trust.
Aurora mortgage broker: Advantages
Here we are going to discuss some advantages of hiring a mortgage broker.
Saves your legwork
Brokers have contact with several lenders that help you to stay away with lenders having onerous payment terms in their contracts. However, it is essential to do some research before hiring a mortgage broker. While assessing mortgage brokers credibility, using tools like a mortgage calculator will let you compare rates.
Brokers have better access.
Some lenders are dependent on the mortgage brokers to get reliable clients. If you want to get a retail mortgage, then you don’t have to call the lender directly.
Saves your time and money.
Working with a mortgage broker will save time and money.
Brokers will manage your fees.
Working with a lender and taking a new mortgage includes several fees such as origination fees, application and appraisal fees. Most of the time, a mortgage broker can save you hundreds to thousands of dollars.
Disadvantages of an aurora mortgage broker
Below we are going to show you some disadvantages of hiring a mortgage broker.
Interest may not align with your own.
You have to find a mortgage with an affordable interest rate and fees. The goal of a mortgage broker is to provide you with a mortgage that maximizes their compensation.
May not find the best deal for you.
Brokers can find the best deal for you that fits in your budget, but it is not always the case. However, if your broker is offering a great deal, then it never hurts to shop around on your own.
You may owe a fee
As we all know, a mortgage broker gets paid by both borrowers and sellers. You might turn to a more expensive loan if the fee is cover by the lender because the commission is more lucrative. So figure out the mortgage cost before getting a deal and be sure to settle all fees issues.
Do not guarantee estimate.
Most of the cases, depending on your application, lenders change the terms and ends up paying a higher rate.
Some lenders are not ready to work with mortgage brokers.
Sometimes lenders decide to not work with a mortgage broker and source through direct lending. However, you may not access to the lenders who offer you better terms than you get through the broker.
Cost of a mortgage broker
A mortgage broker gets paid from both borrower and lender. However, they compensate and earns between 1% and 3% of the total loan amount. There are different types of fees involving origination, application and appraisal fees.
So you have to clarify the fee structure of a mortgage broker to know there are no surprises on the closing day.
Final thoughts
So here is the complete information about mortgage brokers Aurora. However, getting a mortgage broker is a better decision before buying your dream house. It will save your time, money and find you the best deal that fits in your financial needs.
