How to Find Good Mortgage Brokers

Good Brokers Make a Difference

A good mortgage broker can make all the difference in your home buying experience. If you buy a house but pay too high an interest rate, or purchase a bait and switch loan, or fall prey to predatory lending you will regret it for years to come.

Whether this is your first mortgage, second mortgage, a refinancing move or you are a real estate investor you need to know how to find a good broker. Follow these steps and you are sure to get not just a good mortgage broker, but one of the best.

Instructions

1. 

   AVOID TAKING THE MORTGAGE BROKER WHO IS EASIEST TO COME BY.

   I often advice people against using Uncle Jack as their real estate agent or mortgage broker unless they have good reasons beyond acquaintance or family. I have used a friend as a mortgage broker. But only because I knew he was the best in town, even in that part of the state. He was offered large six figure salaries and regularly wooed by other banks. Wouldn't you like to have that kind of mortgage broker instead of a part time relative or friend?

   You want a broker who knows all of the options, is familiar with the area, and can coordinate with your realtor at closing time efficiently and with ease.

2. 

   CALL AROUND FOR THE BEST MORTGAGE RATE.

   Type into google 'mortgage broker' and add the target town. Pull up phone numbers and make a call. Tell them you are trying to find a rate and give them a general idea of the kind of loan you want and the level of credit you have. They have to have some numbers to plug in. So know whether you lean toward a thirty year or fifteen year mortgage, a fixed rate mortgage or an ARM. You should have your free credit report with number in hand. If not, make one up that sounds close. The main thing is to give every broker the exact same information so that you can compare.

   This is crucial! If you add just 1/4 a percentage point to a $100,000 mortgage for thirty years you lose 6,000 dollars of real money.

3. 

   ASK EACH BROKER A SET OF STANDARD MORTGAGE QUESTIONS.

   - Given this size loan and my credit what percentage would the loan be today?
   - Would I pay points for this rate? (1 point = 1 percent of the mortgage value paid up front)
   - What would you estimate the total closing costs to be?
   - Would you suggest I get a different type of loan?

   If they suggest a no interest loan or a high percentage interest loan with cash back you probably want to find another mortgage broker.

4. PAY CLOSE ATTENTION TO HOW THE MORTGAGE BROKER TREATS YOU.

   Yellow flags:
   - You are treated as an interruption or a nuisance
   - You are condescended to and treated without respect
   - Calls or emails are not answered promptly
   - The broker keeps trying to sell you a mortgage product you didn't ask for

   Green lights:
   - Prompt and courteous responses
   - Knowledgeable about mortgages but respectful tone
   - Competitive rate and low closing costs
   - Willingness to take extra steps to make you happy

Tips & Warnings

• Build good will with your broker throughout the process. You may need it later.

• Ensure there are back up brokers to handle your mortgage within the same company.

• Ask for recommendations and referrals but always ask specific questions. Why are they recommending the mortgage broker? How do they know the mortgage broker? What made them happy with the broker?

• Avoid brokers that either push you around or get pushed around by others. A mortgage broker needs to serve you and go to bat for you with others.

Resources

• Home Buying for Dummies, Third Edition
• What Every Real Estate Investor Needs to Know
• Dave Ramsey's Total Money Makeover
• Dramatically Increase Your Ehow Residual Income
• Make Money Writing Articles Like This Online
• US Lease Agreements