Are you ready to buy your first/next home? One of the first steps is to secure a mortgage. This process can be stressful and overwhelming. Where do you start? What do you need for the process? Are you getting the best service? Are you getting the best rate? Do you have an advocate working with you to help you through? Typically, you have two options: a direct lender/bank or a broker. Let’s review the difference between the two.
- A broker acts as an intermediary, helping you identify the best lender for your situation and pulling together all the information needed for the mortgage application.
- A direct lender is a bank or other financial institution that will decide whether you qualify for one of their specific loan programs.
The benefit of using a broker is that we do the “shopping” for you. We have relationships with several lenders who offer a wide variety of programs with minimal or no overlays (tighter lender-specific requirements). This allows you to have the confidence that you are getting the BEST mortgage for your specific situation and not just what the direct lender has to offer.
10 Reasons Why Brokers Are Better
- Clear cut communication. The mortgage industry can be challenging to navigate. We can help you understand the lengthy process. We can solidify a competitive interest rate, typically with lower fees, and ensure you close on time or even early.
- We are licensed and regulated financial professionals. We do a lot of the legwork — gathering documents from you, pulling your credit history, and verifying your income and employment — and we use this information to find the best options for you across several lenders.
- We help you comparison-shop. We obtain a variety of quotes from multiple lenders and present you with the best option to suit your specific needs.
- We save you time. It can take hours to apply for different loans, with back-and-forth communication involved with underwriting the loan and ensuring the transaction stays on track. We can save you the hassle of managing that process.
- We work on your loan from start to finish. We are invested in you throughout and therefore will be with you every step of the way. Banks and direct lenders use the “assembly line” mentality, handing you off to other people throughout the process which can cause frustration, confusion, and delays.
- If your application involves challenges, we have the capability to find a lender who can provide a competitive interest rate, without significant overlays, whereas a direct lender/bank would be limited to their own product guidelines. Direct lenders/banks do not shop with different lenders for you. For example, a direct lender/bank might not even be able to qualify someone with a 600 credit score, but brokers have lenders that would allow such a score for traditional financing (FHA, VA) without severe negative impacts to the interest rate, process or closing.
- Just like your real estate agent, we work for you! We don’t get paid unless you close your loan. For this reason, we are more accessible to you than lender/bank employees. When you have questions along the way, it’s easier to get the answers you’re looking for more quickly and more thoroughly.
- We can undoubtedly find more competitive mortgage rates than direct lenders/banks. We are paid to shop for the best rates and loan programs.
- Personalization! You can meet with us face to face, in our brick-and-mortar office or completely online, and get your questions answered by ONE person. That may be more reassuring than talking to a different person every time you contact the national call center for a direct lender/bank.
- Our volume is much less than direct lenders/banks. We care more about our clients, their well being, and their overall satisfaction. Rest assured: you will be happier with the process and the service you receive from us.
If you are in need of a new home mortgage, whether that be a new purchase or a refinance, Future Home Loans is here to help you. We are a locally-owned, Veteran owned, mortgage brokerage that will put the time and effort into finding you the best mortgage with competitive rates for your financial situation.