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Good, bad, or indifferent credit? A mortgage broker may have the perfect loan for you. And these loans are not just for your proverbial white-picket fence. Whether you’re looking to buy an apartment in Montreal or a house in Toronto, there is likely a mortgage out there with your name on it. Brokers are listed as one of the best resources by such organizations as Bankrate Money to help those looking for purchasing or refinancing a home purchase.
Who Is A Mortgage Broker?
- Who Is A Mortgage Broker?
- What does a mortgage broker do?
- Factors To Consider While Looking For a Mortgage Broker
Mortgage brokers are professionals trained to help you find the right loan and make sure that you can afford it. They allow you to find a mortgage, work with your lender in case there is an issue, and then assist in the process of actualizing your loan.
A mortgage broker helps you through the entire process of getting a mortgage. They will explain what kinds of loans would benefit you; they’ll explain what interest rates are available, and they’ll act as an extension if anything goes wrong. The broker will also guide clients on finding mortgages with other lenders.
What does a mortgage broker do?
- A Mortgage Broker works with consumers looking to get loans made by banks or credit unions.
- A Mortgage Broker is licensed by the Ministry of Finance and is responsible for screening the borrowers to ensure they qualify for a mortgage loan according to government regulations.
- These brokers also have access to different mortgage rates offered by various financial institutions, which are available to consumers. The Mortgage Broker will then negotiate with the consumer and the financial institution to get you the best possible rate, matching your needs and financial goals.
In Canada, such a broker is not considered buying the mortgage from the lender but instead acting as the intercessor between the consumer and lender. Such brokers can do this for government-insured mortgages or insurance-based mortgages from chartered banks. Mortgage brokers cannot, however, arrange insured mortgages with non-chartered banks.
These brokers are licensed and backed by the Financial Institutions Commission (FIC) under Part VIII of The Securities Act (Canada).
Factors To Consider While Looking For a Mortgage Broker
Finding the right broker can be quite overwhelming when looking to finance a new house or property. It would help if you made various considerations, such as finding a professional who charges low fees and has experience with your loan type.
Underneath, we look at some essential factors to consider when looking for the right mortgage broker.
- Does the broker have an upfront fee?
- Are there any other expenses associated with this fee?
- Is there an online application form available for their services?
- How many full years of experience does the broker have with your loan type?
1. Does The Mortgage Broker Have An Upfront Fee?
The broker should provide their services for a flat fee or an amount based on a percentage of your loan. If they provide other services such as real estate agencies or insurance, it usually has different prices. These fees should be clearly stated in any advertisements or statements you may find online from this firm. You can also call and ask about this upfront fee when making an appointment. Ask the mortgage broker if there are any hidden fees associated with this upfront fee.
2. Are There Any Expenses Associated With This Fee?
There should be no hidden costs to the broker not given in their promotional materials or on their online application form. If there are any additional costs, such as administration costs or charges, state these clearly in your correspondence with the broker.
3. Is There An Online Application Form Available For Their Services?
If you find a broker who has an online application they will fill out for you and submit to the bank, this is a good sign. Why? Because it shows that they are efficient in their work and can get your loan approved very quickly, rather than having you spend hours filling in the paperwork and then waiting several weeks or months before seeing your loan approved.
4. How Many Years of Experience Does The Mortgage Broker Have With Your Loan Type?
Ask your prospective broker the experience they have in dealing with the exact type of home loan you desire. Because most mortgage brokers are independent contractors, meaning they work for themselves instead of a national or international lender, you should be concerned about their experience.
If they are not familiar with your loan type, then there is a good chance that they will not find you a competitive rate, especially if it is a rare type of loan.
The essential thing when choosing a mortgage broker is that they provide interesting information about loans and have an extensive understanding of them. Finding the right mortgage broker can be all that separates you from your real estate dreams.