Have you been dreaming of buying a home and think you’re ready to start the process? Time to figure out how to get approved for a loan, and the process can be a little complicated, especially if you’re a first-time home buyer.
Before you start loan shopping, you need to figure out what the best option is for you – how should you find the best rates? Who can help you? Should you depend on your bank for a mortgage, or look into a mortgage broker? Going into this process armed with knowledge is key to getting the best loan options possible.
Let’s break down the differences:
What is a mortgage broker?
A mortgage broker is essentially a middleman between you and the mortgage lenders. They have connections to a wide range of lenders and can therefore give you access to a wide range of loan options.
If you’re self-employed or have less-than-perfect credit, a mortgage broker could be a great option for you. They can find your results and connect you with multiple types of mortgages you wouldn’t have access to alone. A good mortgage broker can break down how all the moving parts of interest rates, down payments, and closing costs.
When you work with a mortgage broker like 1st Eagle Mortgage, for example, you can feel at peace knowing the team will guide you through the step-by-step process of finding a solid home loan option and getting approved. They also make it their priority to connect you to a lender that will benefit your long-term financial goals.
What is the process for bank mortgages?
When you work with a bank, you will fill out a loan application and meet with a loan officer who will review some options with you. While the process is pretty straightforward, it does have some shortcomings to be aware of.
Working with banks can be limiting, and you have to do your homework. If you speak to only one bank, you’ll never know that there are much better rates out there for you. Your credit score could qualify you for a much better rate somewhere else, so you should talk to as many as possible to see which will work best in your favor.
Key differences and how to determine which is best for you.
Both options have solid pros, but the key differences are:
Mortgage brokers offer a wide selection of choices and, when you work with a mortgage broker like 1st Eagle Mortgage, they’re committed to holding your hand throughout the loan process and guiding you each step of the way. They are also determined to find you the best rates and find a loan that benefits your personal finance goals.
Not to mention, they have connections to multiple lenders you wouldn’t be able to access alone that could benefit your financial situation. And as you probably know, your financial situation is imperative because it typically determines your rate. But if you have less-than-perfect credit, are self-employed, or have a sticky financial past, 1st Eagle Mortgage can connect you to loans that will not only work for you but also benefit you. For example, they offer loans for as little as 3% down, even if you have declared bankruptcy, had a short sale, or went into foreclosure.
Getting a mortgage from your bank or credit union is a simple process, and they could have great options for you. They also may offer you relationship perks for selecting them. However, you have to do thorough research and make sure you shop around a lot. While your bank may promise you the interest rate offered is a great deal, a mortgage broker has relationships with several lenders and could get you an even better rate.
You get to decide.
It’s nice to have options when it comes to taking out a mortgage. It’s a big commitment, and you want to make sure the loan you choose works for you and your financial situation.
As you are shopping around and trying to determine what path works for you, make sure you do your research. Determine and thoroughly break down what your financial situation is, and ask the broker or bank these important questions:
• How long will the process take?
• What loan options do you think I will qualify for?
• How much will closing costs be?
• Is there anything in my loan application that will make it hard to get approved?
• What can I do to improve my financial situation?
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