You already found your ideal property, secured your down payment, and financially ready to sustain the entire purchasing process. Then one day, your realtor called and suggested that you work with a mortgage broker. You might be thinking, is it really necessary, and you might be feeling a little skeptical in working with one.
However, working with a mortgage broker might not be a bad idea, after all. You just need to learn to ask the right question to determine who you will get. This article can help you through the process of looking for the best-fit mortgage broker for you by asking these questions.
First, what is a mortgage broker?
Mortgage brokers act as middlemen between you and a lender in closing your home deals. They are like your personal shoppers who do the leg-work in searching for the best mortgage lenders. They look for competitive interest rates, gather your documents, meet with several lenders, and do the grueling process of handling all your credit information that is needed to close on a deal.
Working with a mortgage broker is a little bit personal. You need to look for someone you can rely on and trust. Engaging with them personally is the best way to know who is the best fit to handle confidential information from you.
There are many mortgage broker in Melbourne, but you can instantly narrow down your selection by asking these sets of questions to them.
Questions to asks to your mortgage broker
Take your cue from the following:
1. How much is your service fee?
A typical mortgage broker will answer you that you don’t need to pay them for their services because they will receive a lender commission the moment they have closed the transaction. The commission depends on who the lender is; they usually get around 2-3% of the total loan amount.
However, it is significant to be thorough on this one since there is a lender commission and a borrow-paid commission. You cannot afford to handle both, and it shouldn’t be. So push a little bit further in asking your mortgage broker to be clear on this department.
2. What type of loan should I get?
The primary role of a mortgage broker is to help and assist you in applying for the right loan. This is why it is crucial that your mortgage broker is considerate and knows to investigate thoroughly. You would like to get a mortgage broker that asks you questions first and assess your credit history carefully before throwing loan options.
Ask about the pros and cons of getting different loan options and why you should get it. A knowledgeable and well-versed mortgage broker can easily break down specifics that you can easily understand. It would be best if you looked into how they deliver the message and how patient they are when explaining.
3. How quickly can you return my messages?
Communication is a critical thing in working with a mortgage broker. You don’t like to work with someone who calls you back after a series of missed calls from you nor responding late to your emails or messages. You want to look for a prompt and diligent mortgage broker.
Try asking questions like, “If I send out an email to you, how soon will I get a reply?” The most common answer is “quickly,” yet it shouldn’t be the answer you want to hear. Your mortgage broker should be specific and answer you with something like, “In an hour.” You want your mortgage broker to be responsible but not too much.
Working professionals don’t also like to be called frequently during the day by their mortgage broker. If an inquiry can be sent through a text message or an email, it should be done that way.
4. How much downpayment should I pay?
Even though you are financially capable of paying for a 20% down payment rather than paying off 5%, it is still wise to ask your mortgage broker how much downpayment you should pay. It doesn’t mean that if you pay for a large down payment, you’ll receive a better mortgage rate.
Ask your mortgage broker, and they will help you determine how much downpayment you will give to enjoy a better price and consequently save your money for other expenses.
If your mortgage broker offers you a complete breakdown of payments, you should consider this one honest trait since he provided you something you didn’t ask. It is called resourcefulness.
5. How many lenders do you know well?
This might not be a typical question, yet it shows importance, especially for you. You need a mortgage broker who has a wide selection of lenders (non-bank and bank) to shop around. Since you search for the best offer, you need to be sure that your mortgage broker has a wide range. If your mortgage broker answers 15 lists above, that is a good sign.
Getting a mortgage broker to handle all your transactions and close a deal with a lender takes off a heavy task on you. You just need to be thorough in getting one and ask the right questions. Treat this process a personal one, so you will know first-hand that you have entrusted it to someone that earned your confidence.