Why Use a Mortgage Broker?

There will be a number of questions that you have when you start looking to buy a house. How you’ll fund it is probably right up at the top of your list, along with number of bedrooms and what town it’s in. And if you’re not paying all cash for your new property, then you’re looking at a mortgage.

While mortgages are usually funded by a bank, working directly with a bank greatly limits your choices – this is where mortgage brokers come in. In addition to providing a wider array of lenders, a mortgage broker offers extensive expertise in both products and procedures, while having more familiarity with the local real estate market.

For starters, a mortgage broker wants to offer you something that larger lending institutions can’t – reliable contact. We answer our phones. Our customers do not get caught in voice recordings or passed to voicemail. You will not need to press a series of buttons to get help. Knowing that someone is available on short notice to attend to your individual questions is priceless. The house-buying process has enough built-in situations where things can get frustrating. Having difficult access to your lender shouldn’t be one of them.

After access comes the service provided. With a mortgage broker, that usually starts with a pre-approval where your eligibility is finessed before you get too far into the buying process. We perform a review of your income, credit and bank statements BEFORE you submit your loan application. We would never let a customer submit an application without thoroughly vetting its chances of success.

We are especially helpful to first-time buyers. For young people who might need assistance with their purchase, it is important to know how the co-signing process works, along with the correct steps to take if receiving a gift of funds (see “Closing Costs” blog). Additionally, we know how and when customers are eligible for waivers from certain transfer fees, like the CPF fund in Suffolk. (Not to mention – we know that there IS a Community Preservation Fund in Suffolk! Along with all the other local fees.)

Using a mortgage broker is also advantageous when it comes to people with non-traditional employment. The situation for people who have employers can be very different from those who don’t. Working with the self-employed is one of our strengths, guiding them on income needed to qualify or helping to figure out in which year to take losses or gains.

If you go to an individual bank, your options are what that bank offers and nothing else. If you like one-size-fits-all, that is certainly your choice. A mortgage broker, however, has access to big banks, alternative banks and private lenders. And when we do work with a big bank on a mortgage, it is only after assessing whether that bank is the best option for that particular client.

A broker will discuss all the options with you and explain the process. It can be a bit tedious and there is lots of paperwork but we take our time to really educate the consumer. We want our customers to have a true understanding of what they’ll be committing to.

Then there are the products themselves, of which we have a wide range: Fixed rates or adjustable rates; Interest only options; Conventional or Jumbo loans. We can also provide alternative financing options for buyers who do not qualify for traditional products. Our main alternative programs are: bank-statement programs that look at an individual’s deposits and not just reported income, ideal for self-employed people; rental-income programs, where the income-producing viability of the property is taken into account; and an asset-depletion program for people who have money in the bank but little or no earned income.

It may seem like a purchase price funded through a set mortgage time period, paid by a certain income level should be cut and dried but it is not. Each bank has different criteria for the income-to-debt ratio with various lending agencies – Fannie Mae, Freddie Mac, VA and FHA. We’ll dive deeper into this topic in an upcoming Products post.

Should you find yourself with a property that has a non-compliance issue, mortgage brokers know which banks do not require a Certificate of Occupancy (CO), or municipal searches that may bring up issues with lenders. For example, the seller has a house with a deck that they never got a permit for and have no intention of getting one, meaning they do not have a CO. But the buyer wants the house and is ok with the deck not being permitted. We know lenders that are comfortable with that situation.

When it comes to getting an appraisal of the property, we have a distinct advantage. We know the local market and can call in real estate agents to help with any appraisal issues or lack of comparable sales. A big bank has access to the recorded deeds but through our networks, we have access to local knowledge of houses recently sold that have not been recorded yet.

Most importantly, we never give up. During the busy 2021 refinance boom we had many new customers come to us who had been with big banks. They had been waiting 4-6 months without results and were fed up and ready to move on. A good mortgage broker would never let you get stuck in that cycle. We were able to get people their loans within 60-75 days on average.

The personal touch extends beyond our office walls. We’ve had contractor friends install handrails in houses where appraisers had noted the lack of them was a safety violation. Being able to get situations like that fixed quickly can keep the process from veering off the rails into lengthy delays.

Individualized attention is the hallmark of every good mortgage broker – we don’t just know products, we know our neighborhoods and we take the time to know our clients.