If you are buying or refinancing your home and have never worked with a mortgage broker, it may be worth looking into. Your bank or other loan institution only has a limited set of products to offer you — often its own signature products. Not so with a mortgage broker. With the right technology platform, an online mortgage broker like RateJab can harness the power of the Internet to scour the markets for the best loans. Instead of comparing just the handful of offerings that a particular lender has on hand, your broker literally can compare hundreds of options offered by dozens of different lenders. This allows much more flexibility in structuring the perfect loan for you, potentially with a market-low interest rate with no mortgage broker fees that your bank simply can’t match.
Do Not Pay Upfront Mortgage Broker Fees
However, mortgage brokers are not “one size fits all,” especially when it comes to their fees. Mortgage broker fees can vary widely and there are a whole host of ways that they can be paid — some may cost you considerably more than others. Many brokers include a variety of up-front charges in the form of application fees, credit report fees or loan origination fees, as well as closing or other processing costs. These charges can have a way of piling up quickly, so make sure you understand your mortgage broker fees thoroughly before signing on with any particular agent.
Working with an online mortgage broker that deals with wholesale mortgage lenders — like RateJab — offers you the best of both worlds: a low-rate mortgage without any fees to the consumer. The commission is paid at closing by the mortgage lender — not the borrower — and even then, only if the loan closes. You will most likely have other costs from third parties, like title insurance, appraisal fees and government recording charges, but at certain firms like RateJab, these are passed through to the borrower directly with no up-charges.
Close Your Loan with No Closing Costs
There is another big benefit to using mortgage brokers — particularly meant for buyers who aim to be in their homes for less than five years. Rather than paying fees at closing to third parties like appraisers, your broker can roll these costs into your mortgage to pay out over time. In this scenario, your mortgage rate will be slightly higher, but it’s an option you can consider if you are trying to avoid closing costs.
As with any other professional relationship, the most important thing is to feel a sense of trust with your mortgage broker. The best ones are not just out to sell you something, but are trying to really understand your needs and concerns and accommodate them. When you speak with them, they should be asking you as many questions as you ask them.
Do your research and make sure you choose an individual that is transparent about their entire slate of mortgage broker fees. A home purchase or even just a refinancing is a big deal — don’t let anyone try to rush you into a decision you’re not fully prepared for.
If you are interested in learning more about our innovative service, we encourage you to contact us today!