What does a mortgage broker do?
A mortgage broker acts as an intermediary between the borrower and the lender, facilitating their transactions. However, this is really just a small part of the work they put in. They do the work of hunting down the best mortgage product and best interest rate for their client by using their network of banks and lenders.
Can I just go to my bank to get my mortgage?
Yes, you can. Your bank will gladly set you up with their current mortgage products at their current mortgage rates. This means that you will only get a single option- the one they give you at the time. There are many lenders and financial institutions with different mortgage products at different rates and it is your best interest to shop around and make sure that you are getting the very best for your unique situation. Your bank may claim to have the best mortgage products but it doesn’t hurt to let us have a look first. A mortgage broker will have access to your bank’s products and the ability to compare them to those of other lenders to ensure that you are truly getting the very best. They will present you with a variety of choices, allowing you to select the best option and help you make sense of your choices and understand how each mortgage product could benefit you.
Do mortgage brokers work for the banks and lenders?
No. A mortgage broker works solely for the borrower. It is up to the banks and lenders to compete for your business by showing us their best products to meet your individual needs.
Do I have to pay my mortgage broker?
No, you do not pay your mortgage broker anything. The services and fees are paid for by the lender. It is really a win/win situation for the borrower!
How can I qualify for a mortgage?
In order to qualify for a mortgage, a history of financial information is required. This includes gross annual income, credit history, and previous/current assets and liabilities. Detailed documents outlining these items all influence the final credit decision. Every situation is different and your details will need to be individually assessed to determine what you can qualify for.
What will I end up paying in closing costs?
The amount of these costs will vary depending on your situation. There may be an appraisal fee, survey fees, your legal fees, and realtor commissions. Call me today and I can help you get a better idea of what you might be paying with your unique situation.
What is the difference between a variable rate and fixed rate mortgage?
With a variable rate mortgage, your mortgage payments are fixed but the interest rate will fluctuate with changes dependent on the Prime Rate. When rates go up, a larger portion of your payment will go towards interest. When rates go down, more of your payment amount will go towards the principal.
With a fixed rate mortgage, the interest rate stays at a fixed rate throughout your mortgage term. This mortgage term can vary from 6 months to 10 years depending on your preference. Over the course of the mortgage, more of your payment will count towards the principal amount borrowed and less toward interest.
Is there a benefit to a pre-approval?
Yes, there are. When you get a pre-approval you will be able to secure your mortgage rate for a period of time, you’ll have an idea of what you can afford, and you will ultimately appear to be a more competitive buyer. The seller will know that you are serious about buying and this will give you more negotiating power with them. It will also help to speed up the closing costs since you will already have most of the work complete.
Can a mortgage help me with my debt?
Yes, a mortgage is actually a common way of dealing with debts. A mortgage can allow you to consolidate your credit card debt, or free up money for renovations or investments.