- Because both lenders and brokers will lie to you.
- That’s right, even the big lenders will lie to retain clients or get new ones and they get away with it everyday. I see it happen almost every day, and I’m just one broker in one city in the entire Untied States. Not sure if your mortgage professional is being truthful? Post a comment and I’ll let you know what I think.
- Because Interest Rates Change Every Day, Sometimes Several Times A Day
- I can tell you from experience that Lender A’s rates can be lower than Lender B’s on Monday and the opposite may be true on Tuesday. So you get a quote from Lender A on Monday of 6% and a quote from Lender B on Tuesday of 6.25%. Who do you go with? Well, most people would go with Lender A, right? The problem is Lender A may not actually have the best deal, you just happened to catch them on a day when rates were down. Lender B may very well have lower rates in general, but you’d never know that. This is where a good mortgage broker comes in. A good mortgage broker tracks interest rates from different lenders every day for his or her entire career. He knows which banks tend to have the best programs available at any given time. In my case, if I’m not sure who has the best programs available considering market conditions on a particular loan program, I can send an inquiry to all of my lenders and get several hundred quotes in about 20 minutes (of course, then I have to sort through all those quotes, which can take a couple days). The point is, a broker can compare apples to apples whereas consumers can only compare apples to oranges…not effective
- Because You Really Don’t Know Who You’re Talking To
- How well do you know that person on the other end of the phone who’s quoting you rates? Don’t make the mistake of thinking Mortgage Broker’s have an easy job. To be truly effective, a Broker has to be on top of market conditions at all times, he has to have a thorough understanding of all the programs offered by his lenders, and most importantly, he has to be able to foresee problems with a file before they rear their ugly heads (because almost every file has a problem), and they have to be able to merge all this information into a clearly defined “mortgage plan” for their clients. I can tell you from experience, good mortgage brokers are few and far between. Have you ever been told what index your new Adjustable Rate Mortgage will be attached to? It’s information that may be important, and I’d be willing to be that in 80% of refinance transactions, the homeowner has no idea what index his or her loan is attached to; for no other reason than the broker didn’t know either.
- Put it this way, if you were unlawfully charged with a serious crime, are you going to hire a $20 lawyer who makes his money on volume, who isn’t going to give your case the attention it needs, who’s going to clean his hands and walk away as soon as he files the paperwork and shows his face in court? Or are you going to pay extra for a lawyer to carefully consider all the details of your case and help you work to find the best way into a better position; a lawyer who knows your situation like the back of his hand and can let you know, if the laws relevant to your case change, that you should to take a different approach than originally planned; a lawyer who, after your case is over, isn’t going to walk away with his check and never speak to you again, he’s going to help you with appeals or fines, or any other issues you may have when the case closes, as well as offer advice in the future? Obviously, that’s your choice, but when you chose a broker based solely on the lowest cost, you’re representing yourself in the legal system known as the mortgage market on a case that involves what is likely your biggest investment (your home); and when is the last time you thought it would be a good idea to represent yourself in court?
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