Navigating Mortgage Lenders
When we were little, we sat in the back seat of our parent’s car. Tossing around in the back seat at our feet was the big book of maps. “The Thomas Guide” of each city and area. It held the knowledge of libraries, back roads, transit lines, and really just about anything! Our parents would flip through it and memorize the intricate directions to get from one point to the next. As technology progressed, GPS devices could be plugged in or an added luxury feature to a car. Satellite connectivity would ping the GPS and know exactly where you were. You could put in an address and it would compile the directions and pop them up on the little digital screen. Truly brilliant technology at the time. And now, the GPS in a car is pretty standard, if not starting to be phased out again. Everything is at the touch of our fingers on our smart phones. Built in GPS devices are becoming less necessary because we can simply google and tap an address on our phones. Phones and GPS devices eliminated the stress of using and having the giant book of maps in the back seat of the car. It pops up the fastest route and instantly starts navigating us. When buying a home, the process of getting from point A to point B can seem confusing. You are trying to navigate the mortgage process on your own and it can become stressful. How do you find a good interest rate and how do you submit all the applications? A mortgage broker is the little GPS or smart device in your car to help you navigate buying a home. They guide you on the easiest and fastest route to become a homeowner. But how does a mortgage broker really differ from a bank?
What is a Bank?
A bank is a form of traditional lending that a home buyer can use to secure a mortgage. They’re not bad and are great options for some people. Big banks, like Bank of America and Wells Fargo, will typically only have one product available for borrowers. The interest rate they’re offering is what suits their own interests. Depending on what mapping device you’re using, you may be offered one route or many different ones to choose from. The bank is going to be the mapping device that offers one route. This may mean that you’re not getting the mortgage that’s best suited for you. When forgoing the use of a broker, borrowers will have to complete mortgage applications for each individual bank they look into. This can become time consuming and frustrating. Borrowers might not be able to negotiate a rate down low enough to meet their best interests. Banks aren’t bad, they are just not for everyone. They’re still in the business of making money, so your best interest may not always come first.
How Does a Broker Differ?
Brokers are independent mortgage professionals that put your best interest first. They want to help you find a mortgage that YOU’RE satisfied with. A broker works with a myriad of different lenders- both traditional and non-traditional. This helps them find financing solutions for a variety of different borrowers. The borrowers they work with could be the perfect borrower with a fantastic credit score, or ones that have poor credit or self-employed. The self-employed borrower may have been turned down by a traditional lender and the borrower with poor credit might not know where to start. A broker will work with the borrowers to set them on the right path to getting the best rate. They’ll take care of the application process and search for rates. A trained professional is licensed to represent you. This will save YOU endless nights of searching rates and the headache of negotiating rates.
A mortgage is not a one-size fits all. There are borrowers with bruised credit scores, borrowers that are recent immigrants, and first-time homebuyers. A mortgage broker is the little GPS that will guide you on the quickest and most painless path. If you feel like you’ve been stuck looking for the right path, reach out to your local mortgage professional.