Why You Need Mortgage Brokers
A Brief Introduction to Refinancing
You are confused by all the home mortgage terminology and you don't even know what
mortgage brokers do. You do not know what is a lien or collateral and you do not know how to deal with the lender when applying for mortgage. Instead of stumbling along blindly, you may actually seek help from professional mortgage brokers. There are more than 53,000 mortgage brokerage companies in the country soyou could seek help to guide you through the steps of applying for a mortgage. Many banks use brokers to outsource the job of finding and qualifying loan applicants too.
So, what does a broker do anyway? Well, when you seek help from a broker, he can possibly help you through the whole process of searching for a loan, applying for a loan and processing the paperwork right till you get the loan. While there are a lot of stories about mortgage fraud and predatory mortgage lending and how brokers may have been involved in this, there are actually quite a lot of good mortgage brokers who could help you with your application for a loan or a mortgage.
Now, there are mortgage brokers and then there are loan officers. Are these two groups of people the same? When it comes to their job scope and the services they offer, both may have similar professional responsibilities. Both sell loans and both can possibly help you to choose a suitable loan for your needs. However, a broker is usually like a middle person who will deal with the loan applicant and then the lender. In most states, mortgage brokers usually have to be licenced and registered with the state so that they are personally liable for fraud for the life of a loan. Meanwhile, the loan officer usually works directly under the bank or lender so they are under the umbrella license of the lender. Also, loan officers probably can only recommend you loans from the lender they worked under while a broker may be able to offer you more choices from different lenders. Both the broker and loan officer are professionals with legal and moral responsibilities and liabilities to prevent fraud. They are also usually required to fully disclose loan terms to both the consumer and lender.The responsibilities of a
mortgage brokermay cover quite a wide spectrum in regards to selling loans and processing the loan applications. In a detailed look, a broker will market the types of loans available in order to attract clients. When they get queries from potential clients, they will usually assess the borrowers and their financial circumstances including their credit history and affordability. Based on the borrower's information, the broker will usually assess the market and search for a mortgage plan that suits the borrower's needs. Once the borrower is agreeable to the plan proposed, the broker may apply for a lender's agreement in principal or a pre-approval first. Pending that, the broker will usually start collecting the required documents such as pay slips, bank statements and credit reports. With the documents out of the way, the broker will probably complete a lender application form and usually explain the legal disclosures of the loan to the borrower. Finally, the broker will submit all the documents and paperwork to the lender for its approval of the loan and that's all there is to it.
Now you can see all the legwork that a broker could do for you, you may seriously consider going to a broker to help you to get a loan. It will probably make your life much easier especially when you are short of time or do not know how to go about searching for a suitable loan.
by: Ask Bill
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