Finding the Right Broker for your Home Loan

When you are shopping around for a good mortgage, brokers are of course going to make themselves look as appealing as possible so that you will choose them. However, once you actually sit down to work with a broker, you may find that they simply don’t offer what you were looking for; whether it’s a perceived lack of industry knowledge, good lender affiliations, or less than ethical tendencies.

While this may be impossible to know when you’re initially shopping around, there is something you can do to prevent this type of awful realization.

Listen to recommendations!

First, friends and family members can recommend brokers to you that they have worked with in the past. They can let you know how helpful a broker was and how good of a deal on the mortgage they received. More importantly, they can help you avoid the “less ethically inclined” brokers, as well. Plus, you really can’t beat personal experience.

Remember also, however, that people you don’t necessarily know particularly well can also recommend lenders. For example, if you’re building your own home, or completing home improvements, your contractor may be able to recommend a reputable broker to assist you.

In the end, do your homework and go with the lender that you think is right for you. Just remember to take those professional and personal recommendations into consideration, since it could make the process much more enjoyable.

One thing to remember is that for the grand majority of borrowers, there is no effective difference in pricing and total cost of borrowing between most brokers. In fact the greatest differences between mortgage companies are quite often the basic qualities of honesty and responsibility. Because almost all national and even regional mortgage brokers have access to the same wholesale mortgage rates, the same wholesale mortgage programs, and the same alternatives as other similar brokers, your most important decision is to go with the broker you trust. If it sounds too good to be true, more often than not, it is. You'll find that as a home loan applicant, even the closest comparison of Good Faith Estimates will not enable you to make a decision (remember those are just "estimates" and unscrupulous brokers estimate a bit more than their honest competitors). Chances are, the best broker you've spoken with has quoted you accurate fees and rates, and you don't like what you hear because the numbers are higher than the competition. Discuss the other home loan offers you have seen in detail with the brokers you trust the most, and select one to educate you and provide you with the best home loan for your situation.

If you are shopping for a new home ask your realtor for a recommendation. Realtors often have close relationships with a few mortgage brokers they have used with good results in the past. A Internet search for mortgage brokers in your area may also yield good results. Most serious professional mortgage companies will have taken the time and invested the resources for a professional informative website.