A mortgage broker’s major purpose is to be aware of the entire mortgage industry including current rates, which lenders are easier to deal with, and he should have contacts at almost every lender that he can rely on during the entire mortgage application and approval process of his clients. Each mortgage broker has his own specialty; some like to do nothing more than conventional mortgages and others can provide expert advice for or uncommon loans such VA mortgages and reverse mortgages.
Toronto has many of these professionals ready to help any house hunter through the loan application and through to closing. A quick Internet search can produce names and contact information for any kind of mortgage assistance you feel you might need.
The major benefit of working with a mortgage broker is that once he understands a particular needs and has a good idea of your financial history, he will be able to suggest which lenders might be able and interested in helping you obtain your mortgage. Without the assistance and experience of a mortgage broker you may be forced into dealing with multiple lenders on your own. In this type of scenario may be looking for mortgages from lenders that a mortgage broker would have steered you away from for a variety of reasons.
Choosing a broker doesn’t necessarily cost you any more money than if you had just walked into a local bank at lunch time and applied for the mortgage. When you receive the paperwork from your lender, No matter who that might be, you will always see a commission for a broker or loan officer.
If you are dealing with a mortgage professional you should ask him right up front what he charges for a commission. These brokers are all freelance. They work for themselves. This means they can set their own fees or commission levels. This also means that these fees are highly negotiable. In other words, if that mortgage broker can’t get you to the right lender in order to get your application approved, he makes nothing.
Some brokers will charge a flat fee of approximately $1500-$3000. Others will charge a percentage of the requested mortgage. It’s always a good idea to know this figure ahead of time because too many people get to the point that they are just waiting for the final paperwork to go to closing and then they are absolutely shocked at what your broker is charging for his fee.
The broker will probably have you fill out an application before he can get one way or the other as to how much help he can provide for you. A lot of people don’t want to take the time to do this but without the application to broker will have no idea what your credit history is or what your true financial picture is.
Usually there is no additional fee for filling out the application so your broker can look at. The application fee only comes into play when he finally presents it to the lender.