What is a Mortgage Broker?
A mortgage broker acts as an intermediary between the homebuyer receiving the mortgage and the mortgage lender.
Mortgage brokers, sometimes referred to as mortgage agents or specialists, help homebuyers find the best mortgage rates and terms by shopping around among a variety of lenders. The broker then presents the buyer with the available options and helps them to select the best one. They may also assist with mortgage pre-approvals, loan applications, and the negotiation of terms. Mortgage brokers typically charge a broker fee or commission in return for their services.
Why is this term important?
Mortgage brokers are important as they help homebuyers select the best mortgage product for their unique situation.
A mortgage broker can help navigate the complex process of obtaining a mortgage, providing valuable advice and expertise. They handle many of the details and paperwork, saving the homebuyer time and effort, and can help buyers understand and improve their credit score, which may help them qualify for better loan terms.
Here is an example:
When someone decides they’re ready to begin exploring buying a home, one of their first steps will be to get a mortgage pre-approval. Often, this is done through a mortgage broker. The mortgage broker will walk the homebuyer through the process and help them determine their home-buying budget. Then, once the homebuyer makes a successful offer on a property, they will return to their mortgage broker to officially apply for a mortgage loan.