What if someone could make house buying easy but nobody knew it?
That’s how it often feels for a mortgage broker. They help people secure loans for their dream homes, but most buyers are still asking “what does a mortgage broker do?”
If you’re still asking this question, check out our guide for the answer as well as whether you actually need a broker or not!
What Does a Mortgage Broker Do?
Let’s start with the big question. What, exactly, does a broker really do?
A good mortgage broker basically serves as a middleman when you are buying a home. Without a broker on your side, you must handle things like loan applications and rate negotiations all on your own.
This can be difficult for someone who has no training or experience. However, a good broker can help negotiate better loan interest rates, and this can help to save you thousands of dollars over the lifetime of a loan.
How Much Does It Cost?
It’s exciting to hear that a mortgage broker can save you so much money. This leads to a pretty natural question: what is it going to cost?
The exact answer depends on who the broker is. This is because different brokers are paid in different ways.
Some of them are paid by the lenders they work with. Others, however, are paid directly by the borrowers they are helping.
The amount that brokers charge is usually controlled by the relative value of homes in the area. And there are also federal restrictions that keep brokers from making more than 3% in points and fees, offering some protection for borrowers.
Different Kinds of Brokers
There are many different kinds of brokers. However, they generally fall into one of two groups: those who work for banks or other financial institutions and those who work for themselves.
There are pros and cons to each kind of broker. Those working for a bank may be able to secure a competitive loan from the bank they work for and ensure the process is nice and speedy.
Independent brokers don’t have the same relationship with any single bank. However, they may be a better way to explore all of your options and ultimately help you get the most competitive rate.
Other Broker Advantages
Earlier, we mentioned how brokers can help to negotiate a better interest rate on a home loan. But there are also some other advantages to going through a broker.
For example, brokers can figure out which home loan is best for your particular needs. And they can make recommendations about how much you should borrow and how much you should put down before buying.
Ultimately, it’s true that you can do everything a broker can do on your own. However, this takes a lot of extra time and adds a ton of stress to the already-stressful process of buying a home.
The Bottom Line
Now you have an answer to “what does a mortgage broker do?” But do you know where to research the greatest homes in the world?
At Celeb Homes, we keep track of the hottest houses owned by the coolest celebs. Kick your daydream off right by browsing celebrity Florida homes today!