A mortgage broker does many different things when he or she becomes a lender’s representative. First, a mortgage broker has two main jobs: First, to assist you in finding the most cost-effective loan product and competitive mortgage rate for your real estate purchase, and second, to advise you through all the loan application and approval process. Brokers utilize their full arsenal of mortgage lender contacts, wholesaler rates, and the wholesale fees they receive for those relationships to comparison shop… all on your behalf.
So, just what does a mortgage broker do? Well, as an attorney does with a client, a broker represents you; that is, acts on your behalf as your attorney does. Mortgage brokers do not do any legwork for you personally; they will not contact potential buyers or sellers, nor will they do any investigation of any type. They will not file paperwork, send letters or questions or faxes to lenders or buyers. A broker’s work is to market you and your real estate purchase to the largest market possible.
Now, one could say there is still some “trickery” involved in the mortgage application process – after all, how can a lender deny a mortgage application based solely on incomplete information? However, this really is where the concept of “entrepreneurism” comes into play. As mentioned above, mortgage brokers do not do any of the work for you; however, they are knowledgeable about the lender markets, which means they are often more aware of any “red flags” or “flimsy” lending practices that may be used by a lender. Besides, brokers have access to hundreds of lender programs and are aware of any programs that may not be advertised to the general public. This knowledge also helps them determine better if a lender is a “good fit” for your particular situation. If they feel a mortgage program is a bad fit for you, they may be able to tell the lender directly.
Now, we all know what a mortgage broker does for you; but do you even know what it is? Well, a mortgage broker is someone who actually acts as an intermediary between you and the lender. Basically, this individual acts as a conduit between you and the lender, passing on your mortgage application to the lender, who then reviews and makes offers to the borrowers. The broker makes sure that you receive the best offer possible but does not tell the lender exactly what you are getting. The mortgage broker’s goal is to secure you the best offer and work hard to make certain you receive the best offer possible.
One important aspect of what a mortgage broker does is finding out what type of lender the borrower has chosen. While the lender itself does not have a hand in the process of actually approving or denying a loan, the lender does have an interest in making sure that the borrower does actually meet their end of the deal. Therefore, when a borrower seeks out a mortgage broker, they ask the broker to find out which lender the borrower will have the most luck with. This information helps the broker find out which lenders will be willing to approve borrowers.
Another aspect of what does a mortgage broker does is to assist the client in negotiating loan terms. As I mentioned above, if you have a less than stellar credit score, or if you want to apply for a loan amount that is a bit on the low side, the broker can help you with the negotiations. A good broker will have a thorough understanding of all of the variables that go into the approval of a loan and will be able to use these factors to obtain the lower loan amount that you need. When you have a lower loan amount, you are better protected financially, and you are also able to get the loan terms that will make your payments easier to handle.
Many different types of brokers deal with loans, including investment brokers, mortgage brokers, commercial mortgage brokers, home equity lenders, and more. Each of these types of brokers has its own specialties and different methods for how they obtain their clients’ loans. The job of what does a mortgage broker can be slightly different depending on which type of broker you are working with, but many of them still do the same job that they were hired to do. The main thing is to provide the best service possible to their clients.
Of course, not every broker may be knowledgeable about all of the variables involved in obtaining a mortgage, so it is important to ask the questions you need to know to ensure that you are getting the best deal possible. For instance, some mortgage brokers don’t realize that they can receive certain tax credits, so you must ask them about this before submitting your application. You should also find out what other lenders you are competing with, as this can affect your final decision. Finally, make sure that you know what you are getting into before you sign any papers to be completely clear on what you are getting into. Once you know exactly what you are getting into, it should be much easier to find your needs’ perfect loan!