Brokers worth the commision?

4 Replies

Hey everyone

I've never worked with a mortgage broker not to say I wouldn't. Does anyone feel that the fees you pay are worth the service you get? Or in general can you find just as good as a deal going straight to the lender?

Any thoughts?

i know this post is old, but you might still be wondering.

For many people, brokers are the way to go. For others banks are the way to go.

A basic rule of thumb, but not applicable in all cases is that a loan from a broker may have slightly higher initial fees/closing costs, but brokers can often get you a better interest rate. Actually, most of the time brokers can find a better rate.

On the other hand, banks often have lower closing costs and slightly higher rates on average.

So, the main reason to go with a broker is because brokers search many different banks for the best rates while a bank will only offer you their best rates (which might not be the best for you)

It is worth it to get a quote from a bank and from a broker to see what the difference is.

If you have a high crdit score say over 750 you can walk in any bank and walk out with a great rate and very little paper work . Is is good for 15% of the people in the country . The other 85% should use a broker because he can find you programs the banks don't even offer and lenders you can not go direct to only through a broker who have programs you can't get in a bank . They will also shop different lenders for the best rates for the program you are looking for . For instance one lender may have the best rates for an option ARM but not for a 30yr fixed . Lets say you went to a bank and picked their option ARM then wanted to change to a 30yr fixed you were getting the best rate you could find for the option ARM from that bank but they did not have the best deal for the 30yr fixed . A broker would use a different lender than the one he picked for you for the option ARM because he knew the lender that had the better rate for the 30yr fixed .

I have friends that work at big banks, and I don't mean to knock them, but have you ever applied for a loan at the bank, and experienced the application process. You have your personal banker, straight out of college inputting all of your info in to a computer, and then tells you that either him or his lead will be giving you a call later on, or worse they will quote you something on the spot just to keep you happy and then change their quote three or four times. There are exceptions of course, but great majority of their loan officers know very little about loans and real estate, and if you run in to an obstacle like a judgment or a title issue, then forget it, the process will take months. Think about it, you are taking out the biggest financial obligation of your life, is this how you want this to go?

Professional, experienced broker can help you find the right fit for your particular situation quickly, lock your rate, process your loan quickly, and fund it in a timely fashion. You should be getting a much better service from a professional broker, and that is the bottom line. Excellent service at a fair price.

I know that there are lots of worthless mortgage brokers and rip of artists out there and you have to educate yourself to be able to avoid them. Ask for Good Faith Estimate right away, if they fail to provide it, Beware!

I agree with everyone's responses.

Unless you've got spotless credit (730+), most banks won't even waste their time.

Reasons to go with a broker: access to multiple lenders (I could say 100s, but that'd be a tad over the top) to find the best rate, credit score doesn't have to be the best, specialization (most bankers do everything, and might not know how to tailor fit a loan to your needs).

Obviously my opinion is slightly biased :D
(see blog)