5 Things A Perfect Mortgage Broker Will Do, Simplified

what do mortgage brokers do

Can Mortgage Brokers Guarantee The Best For You?

Mortgage brokers are people who facilitate the process of getting a loan for borrowers from any lender.

However, they have special status and privileges compared to other financial institutions and banks.

A mortgage broker is not associated or affiliated with any bank, credit union or other lender. In fact, it is one of the only financial institutions that directly negotiate with the lenders and borrowers.

When you go to a bank to apply for a loan, you will be asked to fill out an application and submit it to the bank’s loan department.

There, you will be expected to provide documentation of your income and other personal assets. Your loan application is then returned to the bank with your loan details. At this point, the process begins.

Brokers can assist with your mortgage documents, title insurance, and down payment

Mortgage brokers may be registered or certified agents. Their professional responsibilities include brokering mortgage loans for customers.

Brokers may also deal with the preparation of mortgage documents, title insurance and the verification of down payment and closing costs. These professionals are involved in all the stages of the whole lending process.

They communicate with lenders and borrowers alike. They prepare loan proposals, conduct negotiations with home owners, and close the deal.

Obtaining low loan interest rates and fees

The primary duty of brokers is to obtain for the customers low loan interest rates and the lowest fees and charges. This means that when approaching a lender, a borrower will have to ensure that they will be able to pay for the loan.

In addition, a broker has to make sure that a customer will get a loan that suits his requirements and the financial standing of the broker. Mortgage banks usually require clients to show a minimum deposit or cash down payment.

Coordination with lending officers and credit unions

Retail banks are not the only financial institutions that engage mortgage brokers. A number of other lending institutions also provide this service.

Lending officers who are responsible for loan approval will often contact brokers and request their help. Large banks and credit unions are the usual customers of this kind of financial service.

These financial institutions require brokers to keep track of the underwriting process of loans and sales.

The difference between mortgage brokers and bank employees

Brokers often differ from bank employees in the way they communicate with customers.

In fact, a mortgage broker does not speak directly with a customer but rather with the lender. They will use all kinds of jargon to make their task easier for the banker.

However, the main purpose of a broker is to find a loan that best suits a customer’s financial needs. This means that a broker can recommend a client a loan even if it is not the best suited for his needs.

This type of service will usually cost the client money but the main benefit it offers is that the customer will get a loan that matches his requirements.

Why brokers earn more

It is true that mortgage brokers make more money than ordinary loan officers.

mortgage brokersThe reason is that they have contacts with numerous lenders. This means that they can refer clients to various lenders, which allows them to secure better deals for their clients.

In addition to referring loans to several lenders, they also get to know about the policies of different lenders. This allows them to assess which company would be the best one to lend to borrowers.

Mortgage brokers do not necessarily work alone. There are other groups associated with them such as loan originators and title companies. These groups work together to secure loans for their clients.

Most importantly, both groups work to ensure that a good loan application is made to a lender so that a client gets the loan that he needs.

Read More

Can A Mortgage Broker Help You? 6 Vital Points For A Better Experience

Is it worth using a mortgage broker

Can A Mortgage Broker Help You?

There are many reasons why you may be considering the use of a mortgage broker.

Perhaps you need to get a loan quickly and need the cash now. Or perhaps you want to refinance your current mortgage, but don’t know how much you can qualify for or if you even qualify in the first place.

Or, maybe you are interested in exploring the possibility of buying a second home or an investment property, but just do not know how to go about doing so.

Whatever the reason, if you are considering using a mortgage broker, there are some things you should know before you decide.

What exactly is a mortgage broker?

In essence, a mortgage broker is someone who helps a borrower to get a loan.

The exact role a broker will play varies by lender and institution, but typically they will: obtain a loan, submit it on behalf of the borrower, and collect a portion of the loan proceeds.

Although some lenders allow their brokers to act as an actual representative of the bank, most prefer for the broker to work solely as an intermediary. This means that a broker organises the loan amount directly from the lender and acts as a third party between the borrower and lender.

Brokers are also responsible for ensuring the accuracy of paperwork and collecting payment from the borrower on behalf of the bank.

Mortgage brokers get commissions

So, now that you know what a mortgage broker does, how does he/she make money? Most professional brokers earn a small commission on each loan they secure.

In most cases, the portion of the commission is given to the broker, while the remainder is given to the borrower. The lender has no obligation to accept a loan from a broker, so most mortgage brokers have several lenders they work with on a regular basis. The commission is not charged back to the borrower.

In other words the mortgage brokers services are free.

A broker can help with application fees and down payment

Using mortgage brokers will save you time and money.

When you apply for a mortgage through a mortgage company or broker, you will be responsible for paying application fees, title and processing fees, and down payment fees.

Many people find it difficult to remember all these different payments every month, but mortgage brokers make it easy by making sure you are cognisant of all fees and charges, if applicable.

Getting the best mortgage rates and terms

Another advantage to using a mortgage broker is that you can usually get a good deal on your home loan. When you deal directly with a lender, you may not get the best mortgage rates and terms.

Often, mortgage companies will approve you for a certain amount of money and then require you to pay a hefty insurance premium. A broker, on the other hand, is free from such worries because he knows what the market will do.

What are some disadvantages to using mortgage brokers?

In addition to the above-mentioned advantages, there are also some disadvantages to choosing a mortgage broker. Sometimes, mortgage brokers try to sell you something else.

You will often have to accept products you don’t really need. Also, some brokers charge fees and they can be expensive.

One last disadvantage to mortgage brokers is that they might try to sell you a product that doesn’t really belong to you. For instance, they might claim that you can get an FHA loan for a certain price.

mortgage broker help youThis isn’t necessarily true because the FHA loans are usually insured and regulated by the federal government. If you’re looking to purchase a house through a broker, you must do your research first. You should also ask other homeowners who have used brokers about their experience.

The cheapest way to find out about the quality of mortgage deals offered by different lenders is to go online and use a mortgage broker comparison or review site.

Is it worth using a mortgage broker?

If you’re planning to buy a new home, then a mortgage broker might be a good idea. Otherwise, it’s not necessary.

Make sure you know what you want before you go to a mortgage broker, so that you’ll be better prepared when he shows up at your office or home. Then you can make an informed decision about whether to use him.

Read More

Mortgage Broker 101 — Simplified For Beginners

Mortgage Broker 101 — Simplified For Beginners

what does a mortgage broker do

What does a mortgage broker do?

A mortgage broker is used by home buyers and investors to access the largest source of mortgage loans. In simpler terms, they help first-time home buyers, home up-graders and refinancers in finding the perfect home loan for their needs and in closing them.

There are a variety of mortgage providers in the Australia — there are literally hundreds of thousands.

This wide variety of products available includes interest only payments, repayment, and interest only loans. This is where brokers come in; they work with lenders to find the right mortgage product for you based on your individual needs.

A broker’s job is to give you an honest assessment of the mortgage loans available to you and advise you as to which product will give you the best return on your investment. In most cases, brokers receive commissions on each product they sell.

So in most instances the brokers services are free to you — the mortgage provider pays the commission to the broker.

Mortgage brokers typically work with mortgage providers from a list of hundreds of lenders.

As the number of lenders increase, so do the types of products offered by them. Some lenders specialize in certain types of products, such as variable rate mortgages, credit mortgages or even low-doc mortgages.

So in the end, you’ll have to do some research to find out which lenders provide the product you need and to get the best deal.

How do I know what my mortgage options are and what they’ll cost?

You’ll get a complete overview of your mortgage options from your broker at the time of your application.

Brokers are not permitted to provide personal advice to you without any assessment. Instead, the mortgage broker takes it upon themselves to assess your financial position and then advise you on the product that will give you the best return.

The good news is that regardless of what type of mortgage you have or want, you can still use a broker’s services to shop for the best interest rate and package deal.

By using a broker you will have a good general idea of the mortgage options and any additional costs involved that may come your way in advance. Read our article about the 9 things to consider about home loans and the different mortgage options by Moneyhelper.

mortgage broker

What are the merits in having a broker when it comes to mortgage lenders?

Mortgage brokers may also be referred to as “non-traditional mortgage brokers” or “altra lenders.”

They have access to many lenders through their connections with a major online mortgage aggregator. This aggregator often times acts as the “underwriter” for the application, so you’re only going to get an almost unlimited number of lenders to choose from.

Since these brokers are paid by the lender, you’ll typically have better rates and terms available to you than you would when you go to a traditional lender directly.

Another advantage of hiring brokers is that they often work as independent contractors rather than being employed by a specific lender. They will get paid for their services once they find a loan for you.

There are some disadvantages, to using mortgage brokers, of course.

Most of them get paid based on the money they refer you to lenders. Since most people rarely know how much a specific product or service is worth until they try it themselves, some people could occasionally  wind up paying more than is necessary.

The bottom-line in mortgage loans:

In general, a mortgage broker does all the shopping around for you.

They contact the different lenders to work out the best deal for you. Sometimes though, they may charge you a fee for this service (vary rare though). Brokers receive payment from the lenders for their services, so they are often willing to forgo fees to the customer.

Overall, brokers are quite useful because they allow you more control over the loan process and can save you a lot of money.

If you need a mortgage quickly but don’t want to use the traditional process, you may be able to get a better deal this way. Typically however, you should not pay any fees to a broker unless you absolutely need to.

Read More

Your First Mortgage Loan: 9 Important Criteria To Consider

Your First Mortgage Loan: 9 Important Criteria To Consider

Do you want to buy a condo or a house? By becoming a landlord, you can stop paying rent and you can even collect one. However, you must also have the ability to pay your mortgage loan as well as the new expenses to be expected when you become a homeowner with your first mortgage loan.

Here are 9 criteria to consider when obtaining your first mortgage loan.

The down payment

For mortgage loan insurance, you must pay an amount that is 5% of the purchase price of your home. So, for a property at $ 350,000, the down payment will be $ 17,500. If your home costs more than $ 500,000, the minimum amount is 5% for the first $ 500,000 and 10% for the rest.   

You will receive an insurance premium from CMHC if your down payment is greater than the minimum amount. This varies between 2.8 and 4.5% of your mortgage loan.

Your future budget

Before thinking about buying a first home, it is strongly recommended that you check your credit report. Anomalies could affect your chances of getting a mortgage. It is also good to try to plan for the money you may have in the future. A change in circumstances could potentially decrease your income.

Your mortgage borrowing capacity

Your mortgage payments should not exceed 40% of your gross income . Your borrowing capacity can depend on a multitude of factors which include, among other things, your annual salary, but also your current expenses such as your housing costs. 

To determine your ability to pay, see a mortgage advisor. They will ask you several questions to check if you are able to pay your mortgage. 

Mortgage pre-approval by your financial institution 

Receiving pre-approval from your financial institution will allow you to make a better estimate of your purchasing power . Sellers are also more willing to sell their property to buyers who have received mortgage pre-approval.  

Obtaining mortgage pre-approval is free and can be done by consulting a financial advisor. Keep in your possession all the documents that determine your financial situation (tax bill, bank statements, pay stubs, etc.). You will be better able to demonstrate to your financial advisor that you have the ability to buy a property. 

The amortization period of the mortgage loan  

The amortization period is the length of time the bank gives you to pay off your mortgage. The longer it is, the lower your monthly payments will be. However, you will pay more interest . 

The law provides for a maximum amortization period of 25 years . If you can afford it, you can choose to reduce your amortization period. This will allow you to pay less interest on your home mortgage.  

Fixed or variable rate? 

At the end of the term, which lasts between 2 and 5 years, you can renegotiate your interest rate. A variable rate, as its name suggests, varies depending on the market. 

The frequency of mortgage payments 

You can choose to pay your mortgage payments monthly, biweekly, or weekly. It is also possible to make an expedited payment rather than a regular payment.

You will pay a little more each year, but you will reduce the amortization period of your mortgage.

The possibility of early repayment 

You will have the choice between an “open” or “closed” mortgage. 

An open one will allow you to make an early repayment, that is, to increase your monthly payments to shorten the amortization period . However, it comes with higher interest rates. A closed mortgage comes with a lower interest rate, but you won’t be able to change your payment amount as you see fit.

Life insurance and disability insurance 

Some mortgages include life insurance or disability insurance.

Life insurance allows you to repay the amount of the mortgage loan to the institution if you die. It is useful if you are sharing your mortgage payments with someone else or if you have dependents.  Disability insurance protects the buyer in the event of accident, illness or injury. It is important to choose it well, because it comes with several conditions.

Read More

A-1Perfection, The Ideal Emergency Management Firm

A-1Perfection, The Ideal Emergency Management Firm

Who is A-1perfection?

If you’re looking for a trustworthy and experienced emergency management firm, then A-1perfection is the ideal choice for you. The website is highly suggested for those people that are searching for complete disaster management alternatives.

Disasters can happen in the form of floods, hurricanes, fire, etc.. Perfection is one of the disaster management companies in the world these days. The Business is headquartered in Northern Illinois and Southern Wisconsin.

a-1perfection

A-1perfection has tie ups with insurance companies and offers reimbursement as well as recovery to those who have suffered due to a disaster.

The company handles every aspect of the loss due to tragedy right from reconstruction. Perfection has a helpline number for answering your requirements. The business provides different restoration services like water and fire damage restoration, renovation, move outs, large loss branch, duct cleaning, etc..

The staff at perfection is given world class training even before they’re implemented from the disaster management group. The company is equipped to solve all your problems and bring your life back to normal in the shortest period possible.

How does A-1perfection conduct emergency management?

In case of water damage restoration, A-1perfection has the capability to handle any kind of loss that’s caused due to water – by a small leakage to big floods. The business also specializes in sewage services as well as disinfecting the region affected by water.

Steps are required to make certain that no more damage is done to property because of water. In terms of fire restoration, the business specializes in restoring property that’s been destroyed by fire. Even in case of a fire, the company will use all equipment and means to stop the fire from spreading and damaging additional property. The

Region is made smoke free quickly and also an inventory analysis is also required to check which property has been dropped or destroyed by fire.

For renovation of property, the company has a full-fledged group of experts – carpenters, architects, engineers, technicians, technicians, and fire restoration technicians. The main objective is to handle every aspect of the reduction.

Reconstruction includes tasks related to odor removal, water damage management, roof repair, plastering, carpet cleaning, carpentry, interior and exterior painting, pop blasting, and emergency power.

Other than renovation tasks, the firm also specializes in carpet cleaning by a team of professionals. The cleaning process is safe and effective as procedures are implemented to eliminate almost 96 percent of the dust particles and bacteria on your carpet. No matter your carpet or carpet is, it’s always safe in the hands of Perfection. The business specializes in deep carpet cleaning as well as stain removal, pet odor removal, and mildew removal.

Back to Homepage

Read More

3 Critical Points About Mortgages For Every Beginner

3 Critical Points About Mortgages For Every Beginner

Many are confused about the word “mortgage” in regards to lending funds. Factors seem difficult if this word is connected to our home, though its procedure is not very complex. Keep reading this article to explore more about mortgages.

Commonly, mortgages are a legal agreement involving a loan provider and a debtor . A mortgage enables a person to take a loan from a loan finance agency. However, this would also require debtor to make use of his property as a guarantee when the loan amount will not paid out in accordance with the agreement.

Types of Home Mortgages

Fundamentally there are two types of mortgage. It is essential that the form you will opt for should be based upon your needs and wants . The 2 types of mortgages are:

1. Fixed rate mortgage (FRM).

2. Variable rate mortgage (VRM).

In a set rate mortgage, a fixed rate is set in the mortgage period arranged by all parties. On this kind of mortgage, you need to pay a set every month repayment during a fixed length of time. The fall or rise of interest rates won’t have an effect on the amount you’ll pay for mortgage every month given that the repayment is already fixed.

For that reason, it is very likely for this mortgage to become quite popular. There are set rate mortgages that have a One year payment period while some are payable up to Twenty five years. The payment period of fixed rate mortgages will most likely differ from 1 year up to twenty-five years.

However, a variable rate mortgage consists of a hanging monthly interest rate which can change down or up in to the future depending on marketplace situations. Adjustable interest rate mortgages are supposed to get paid in a smaller time frame. Their monthly obligations and also interest rates are cheaper in comparison with set rate mortgages.

These 2 types of basic mortgage have also other mortgage versions. Interest only payments and principal and interest repayments are classified as variations from these 2 mortgage kinds. Nevertheless, you should also research other types of mortgages in the case that none of the above suit your financial needs and goals.

Locating the best mortgage offers

You might hire the service of independent mortgage brokers or agents to locate the best offers on the market as quick as it can be without going the traditional route.

Finance institutions such as building societies, credit unions as well as banking institutions could also be helpful in your search for the best deals in the market.

Having said that, if you like quickest approach to perform your research, you should get the service of mortgage brokers. Availing their services gives many benefits and you could take a look at our post or look at other sources to see what exactly they do.

The value of the house or property will often determine the lend sum that a borrower can avail themselves of using a mortgage. The expense of lawyer’s fees as well as assessment will be the liability of the borrower.

Nevertheless, reevaluation might be requested from the debtor if he or she finds the valuation wrong. And lastly, it may be stated that, a wise choice could help a borrower to keep away from any of the negative effects of mortgages.

Expert guidance and service are provided through mortgage agents that may help you to grab the best offer in the minimum amount of time. The mortgage loan lender thinks about the worth of the house and property when establishing the amount to be lent.

Being a debtor, the ultimate way to prevent the poor effects of mortgages would be to have a smart decision.

Back to Homepage

Read More

Low Doc Mortgages – 6 Important Pros And Cons

Low Doc Mortgages – 6 Important Pros And Cons

Tired of having to put all that Paperwork Together? Opt for Low Doc Mortgages!

In general, obtaining a home mortgage involves tons of paperwork being put together by the applicant.  Then every aspect of the individual’s financial situation is placed under the microscope.

Applicants with steady jobs are the ones that always do the best with a traditional lender. Professional investors, individuals on a pension, self employed individuals and anybody else who has an unusual financial position or an irregular income has a tendency to not be able to meet the bank’s criteria to qualify for a loan.

2

Low doc mortgages are also referred to as non-conforming loans at times. That is due to fact that they are designed to help applicants who don’t meet traditional lenders’ borrowing criteria.  However, on the other hand, this is not entirely accurate as non-conforming loans are aimed more at bad credit borrowers.

A good credit rating is required by a low doc loan, so they aren’t exactly the same thing. Nonetheless if you need help with this one check with your home loan broker who can help you to get an approval for home loan you seek within a shorter period of time.

How Willing are Lenders for Bad Credit Borrowers?

The low-doc mortgage approval value in Australia is increasing despite the fact that total housing loan approval values in some areas have been flat overall. So although low-doc loans accounted for only an estimated 5 percent of total outstanding loans, this share has been increasing.  Currently, these loans make up an estimated 10 percent of the overall new home loans.

This market’s rapid growth has taken place at the same time that increased competition has been occurring.  Low-doc mortgages were initially marketed by just specialist non-bank lenders.  However, over the past few years, mainstream lenders have gotten into this market.

In particular, some of the smaller banks have been targeting this segment of the market.  On the other hand, major banks were not as fast to get into this market but recently have started to advertise low doc products more actively.

Low Doc Mortgages are Most Commonly Used by the Following Individuals:

– Self-employed entrepreneurs

– Small business owners

– Contractor workers

– Property investors who have dozens of properties

– Casual or part time Short-term employed

– Individuals who don’t have their recent tax returns

– Casual seasonal workers

property-investment-mistakes-1It’s Not All a Piece of Cake

Low Doc loans make it possible for individuals whose financial positions don’t meet the traditional lender’s qualifying criteria to finance homes that they can afford to pay for.

When a Low Doc mortgage is applied for, the lender might still ask questions about your income as well as your liabilities and assets.  Your credit history will also be checked.

Unfortunately, a majority of Australian lenders won’t consider offering Bad Credit Low Doc home loans.  Frequently a letter from an applicant’s account is required on a low doc loan in order to verify the income stated on the mortgage application.  No financial statements or tax returns are required.

The Downside of Low Doc Mortgages vs. Full Document Mortgages

The lending market perceives low doc loans as being higher risk compared to full document mortgages.

One thing lenders really don’t like is the risk.  The higher the risk is perceived to be, the higher the interest rate is likely to be for the borrower.  As a result, Low Doc borrowers have a tendency to incur higher interest rates compared to full documentation loans obtained from traditional borrowers.

Nonetheless They can Still be a Great Opportunity for Some

In addition, the riskier the loan is perceived to be, the less Loan-to-Value Ratio a lender will be willing to advance.  Although the Australian loan market does offer first home buyers home loans that are up to 99% of the property’s value -on Low Doc loans this is not available.  In general, a majority of Low Doc home loans don’t go past 80% of a property’s value. In some lender instances, even lower

However, Low Doc mortgages still provide many Australians with a great opportunity for either purchasing a home, or build an entire real-estate empire.  It is almost impossible to accomplish the latter with a full doc mortgage.  Many start out being full documentation applicants.  However, those who want to expand their real-estate investment portfolios will eventually need to seek out financing via the non-conforming loan market.

Read More