Buying a home is a very exciting process. It is the fulfillment of the American Dream. Whether it’s your first house or you are moving up into a bigger home, you’ll likely need a mortgage loan to finance the purchase. It’s important to understand that not all mortgage lenders are equal. Some may offer better services. Some may give you access to lower mortgage rates and more home loan options.
Here are 5 Tips to Help You Select The Right Mortgage Broker For Your Home Purchase:
- Mortgage Brokers vs. Lenders—Understand the Differences
You have options for mortgage lending solutions. A direct lender or bank will provide the funding for your loan directly. The process may be a bit simpler, but you are also limited by their specific loan programs available and whatever interest rates they are offering. A mortgage broker is more like a personal shopper for your home loan. They will be able to work with any number of banks/lenders, so they can essentially “shop around” to help you find the best mortgage rates and terms.
- Explore Your Mortgage Loan Options
Mortgage brokers and lenders may have different licenses and certifications that allow them to offer different types of mortgage loans. Research the broker and find one who provides a wider variety of mortgage products. You may be able to qualify for a VA loan, FHA loan or USDA loan, which may give you access to better interest rates, lower down payments and other advantages you won’t find with conventional mortgage loans.
- Ask Questions
Remember your mortgage broker is a fiduciary acting on your behalf. Don’t be afraid to ask questions and make them earn your business. Getting a mortgage loan and buying a house can be a complex and stressful process. The more prepared you are, the smoother everything will go. Ask questions of your mortgage broker and clarify any issues or industry lingo you might be confused about.
- Talk with Multiple Mortgage Brokers
You are not obligated to work with the first mortgage broker or lender who reaches out to you or that comes up on your Google search. Ask for recommendations from your friends, family and people you trust who may have recently bought a home. Contact multiple brokers, ask questions and find someone you trust. Having a sense of trust is so important when buying a home. You should feel 100% confident and comfortable with your mortgage broker and your real estate agent. Remember that they are working for you. The best professionals will work hard to earn your trust and protect your best interests every step of the way.
- Get Your Finances in Order
Choosing a good mortgage broker is just one step in the journey to homeownership. Your mortgage experience will go much smoother if you have your finances in order before you start searching for homes or talking with lenders. Work to increase your credit score and pay down debts. Make sure you have a strong employment and income situation. Ask your mortgage broker about getting pre-approved for your home loan. They will thoroughly review your financial standing and, if all goes well, pre-approve you for your mortgage loan. This will let you know how much you can actually afford to borrow.
Plus, being pre-approved will help make your purchase offers much more attractive. The real estate market is very competitive and buyers must do everything they can to make their offers stand out. Most home sellers right now will not even consider an offer if the mortgage isn’t pre-approved. Having pre-approval for your loan also helps make the final closing process less complicated because most of the underwriting has already been completed.
If you are buying a new home or refinancing your current mortgage loan, follow these simple steps to find a great mortgage broker to guide you through the financial side of the process. If you have mortgage questions or want to learn more about our lending services, contact Moreira Team | MortgageRight today.