Buying a home? A mortgage broker can help negotiate the complicated world of mortgages -- but it's important to know what the needs and wants are, first.
Kelowna, BC -- (SBWIRE) -- 01/29/2014 -- Whether we decide to purchase a house in the country or a swanky downtown loft, the home will likely be the biggest investment one will make. But before the keys get handed to us, there is a lot of research and paperwork to do -- and that includes securing financing for the most expensive purchase of the life.
According to a 2011 survey by the Canada Mortgage & Housing Corporation, 81 per cent of recent buyers, at some point, will rely on a mortgage professional (either a mortgage lender or mortgage broker) for advice and consultation.
When we decide to use a mortgage broker to help us with our financing, they will act as a liaison between us and the lending institution. Mortgage brokers negotiate the best available terms and rates on our behalf, and will usually work with dozens of different lenders in order to secure the financing options that we are looking for.
Here are three reasons to use -- or not use -- a mortgage broker:
1. Mortgage brokers provide their services for free to borrowers.
Pro: Since mortgage brokers are only paid when a loan is approved and signed, their assistance will cost us nothing.
Con: Brokers are paid a commission by the lending institution, and don't work just for us.
2. Mortgage brokers help those with less-than-perfect finances secure a loan.
Pro: For those with blemishes on their credit report or a low household income, a broker might be able to negotiate better rates than if we approached the lending institutions our self.
Con: If the finances are less than perfect, might not be financially ready to become a homeowner, whether the bank will give a mortgage or not.
3. Mortgage brokers will save time.
Pro: Mortgage brokers will do all of the legwork for in terms of paperwork and negotiating with lenders. They will also be the point of contact for everything related to the financing.
Con: Even though will most likely save time by using a broker to do all of the negotiating, some brokers may compare the rates from only a handful of lenders. If want to ensure that 're getting the best possible financing, will have to do the research theself. Because mortgage rates are so easily accessible by anyone online, it is a lot easier than it used to be to compare and negotiate with different lenders on the own.
When deciding which type of financing is right for , here are a few details need to make sure share with the mortgage broker or the lending institution decide to work with.
How often will be able to make additional payments on the mortgage without being assessed a penalty, and how much will be able to pay?
Frequency of payments
Whether it's weekly, biweekly, accelerated biweekly or monthly, make sure the lender offers the payment frequency feel most comfortable with.
Penalties to breaking the mortgage
Make sure that are fully aware of what the penalty would be should decide to opt out of the mortgage term.
Beware of credit counseling agencies that spend little or no time evaluating the finances before advising to enroll in a debt management plan or that ask to begin paying on a debt management plan before the creditors have agreed to work with .
If the unsecured creditors believe that giving what need is in their best interests, they will probably agree to the credit counselor’s proposal.
After the credit counselor has prepared the final debt management plan
Ask for a copy.
Do not sign it until have read it carefully, understand everything in it, and are sure that can live up to it.
Note any restrictions in the plan. It may prohibit from taking on additional credit with the current creditors or applying for new credit while it is in effect. If violate any aspect of the plan, risk having it cancelled.
Verify that the plan says will receive monthly updates on the status of the debt management plan, including confirmation that each of the creditors was paid according to the terms of the plan
When the plan is official, pay the credit counselor the amount of money have agreed to pay on the debts and the required monthly fee. In turn, the counselor pays the creditors.
Some creditors who agree to be part of the plan may report as slow paying or as paying through a debt management plan, which will damage the credit history a little. However, statistics show that successfully completing a debt management plan actually increases the FICO score.
About Kelowna Mortgage Broker
Origination is a Kelowna Mortgage Broker serving customers all across Calgary Canada. Contact the mortgage specialist Kelowna visit https://www.origination.ca/
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