Mortgage Lenders, worth it?

Question

Are Mortgage Brokers worth it? Any experience thought on it would be much appreciated!

Tatiana Conta · Answer

I appreciate all your answers guys, thank you!!

David M. · Answer

@Tatiana Conta

Mortgage Brokers or Mortgage lenders?  The former are really "brokers" who go shop the market for you.  The latter are just lending services that aren't deposit taking banks (e.g. Wells Fargo, Chase, etc.).

In my opinion, mortgage brokers can be useful if you don' t have time to shop the market and/or you have a particular "issue" with your credit or the deal.  They will charge points as their fee/commission

If you are just financing some sort of "regular" residential property and your finances are too wacky (similar to the posts that come on BP who can't qualify...), then I'd say a mortgage lender is fine.  For conforming loans, they are all being resold to the same secondary market, so the rates are going to all be really similar.  Only some companies may run some sort of special deal on a rate but that usually comes with their own terms like a 15 day rate lock (so, yeah, you've got to close within 15 days to get that rate).  I wouldn't go with a deposit taking organization (i.e. a bank) as nowadays they are doing a minority of the loan originations.

So, I look at it as a matter of service, but the mortgage company but really the loan officer.  I've never found the need to use a broker, and made the time to call around and use/find a lender that I can build a good rapport.  Saves me the broker fee.  Also, I don't have to deal with lots of different loan servicers, but just the one.  Like I said, its a matter of service.

talking about service... I had one loan servicer that was only available on teh phone from 9-6.  well, that made it really hard to get a hold them when I had an issue with my loan now and again since I didn't have time to be on hold with while at work...

Good luck.

Stephanie P. · Answer

If you're new to real estate and just trying to figure it out, you're going to be well served to get as many people on your team as possible, so employing a mortgage broker and an insurance broker I might add to get you the best deal on your loans and insurance can save you in the long run.  Yes, there are commissions involved and make sure you don't pay anything like an application fee up front, but it's not wrong to pay people for their service (one of their services is getting your loan to the finish line).  You'll need a good mortgage broker for hard money or long term hold money, but I would use your resources available to find the right one.  Try some REIA's or meet ups and ask other investors who they use.  You can ask title companies and insurance companies too because they get loans from brokers as well as lenders.

Best of luck in your search

Stephanie

Ben Scott · Answer

Hey @Tatiana Conta, I definitely think mortgage brokers are worth it. If you still with one bank, they might not have the right loan products for your deal. Or regulations against certain types of lending. A broker, however, can shop around and get creative.

Sean Todd · Answer

A great mortgage broker is a wonderful asset to have on your team.  It's like adding leverage to your leverage!  An average broker will not be any better than doing everything yourself.  It is worth the time to find a great broker.

Mortgage Lenders, worth it?

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