Buying a house can sometimes be a long, tedious process, which requires a lot of time, effort, and patience. One of the things that make it hard for buyers is looking and applying for a mortgage. While finding the best mortgage for you can be done on your own, are you better of hiring a mortgage broker instead and save yourself from a lot of headaches?
Most homeowners are aware of the fact that they need to shop for the best mortgage rates and terms when applying for one. This means that you need to go from one lender to another in hopes of finding the best term for you. However, doing so can also be time-consuming and this is where a mortgage broker comes into the picture.
According to Investopedia, a mortgage broker is "an intermediary who brings mortgage borrowers and mortgage lenders together, but does not use its own funds to originate mortgages." The mortgage broker helps simplify your mortgage application by gathering your files, looking for the best terms and rates, and submitting your application to the lender.
Hiring a mortgage broker can help make the process easier and can save homeowners from a lot of headaches. However, hiring a mortgage broker doesn't go without any disadvantages. Realtor.com notes that mortgage brokers often charge a certain fee for their services, which can cost you up to 1 to 2 percent of the loan.
This means that you may need to allot a certain amount of your money towards the mortgage broker's fee should you decide to hire one. Certain lenders, however, may also pay the broker's fee, but you need to know all of this before deciding to hire one.
The publication also states that some brokers may also have biases when it looking for lenders. Some brokers may favor a certain lender over the other because of a good experience with them or they may also get additional fees from one lender.
