If you’re buying a home, chances are you’ll need a mortgage, but did you know there are big differences between mortgage brokers and bank loan officers?
By: Phoenix Lee/
Bank Loan Officers
The loan officers at a bank or other lending institution are employees who work to sell and process mortgages and other loans originated by their employer. They often have a wide variety of loans types to draw from, but all loans originate from one lending institution.
The loan officer takes your application and works to find a home loan that suits your needs. If your personal credit is approved, the officer moves forward to process the purchase.
Mortgage brokers are professionals who are paid a fee to bring together lenders and borrowers.
They usually work with dozens or even hundreds of lenders, not as employees, but as freelance agents. Think of mortgage brokers as scouts. They find and evaluate home buyers, analysing each person’s credit situation to determine which lender is the best fit for that person’s needs. The broker submits the home buyer’s application to one or more lenders in order to sell it and works with the chosen lender until the loan closes.
Good mortgage brokers can find a lender for just about any type of credit.
The mortgage broker working to secure your loan is earning a fee for the transaction and the better deal they achieve for a lender, the more they are paid. Don’t be too anxious to disclose to a broker the interest rate you are willing to accept – let them tell you what terms they can secure. Shop around to make sure the terms are reasonable. Many of the mortgages companies that advertise online are mortgage brokers.
The Difference It Makes
Mortgage brokers can often find a lender who will make loans that a bank refuses – problem credit is one example. Getting a bad credit mortgage is tricky and can be very costly if you are inexperienced or don’t know your legal rights. Unfortunately, the industry is ripe with those who will try to take advantage.
Loans for unique or commercial properties might be easier to secure through a mortgage broker. Not every bank offers these types of mortgages.
Make your choice of a lender based on the best loan terms you can find. Ask questions about the expected time-frame. Ask your real estate agent friends who have recently bought a home for lender and broker referrals.
Good mortgage brokers usually have very good relationships with lenders. This is good news for those who need their loans approved and disbursed with as little delay as possible, so that they can enjoy their new homes sooner. In most cases, the application turnaround time can be 2 – 3 days faster than going directly to the bank.
A good mortgage broker will keep you updated on each stage of your home loan application until the loan is disbursed. They will liaise with the different parties like property agents, conveyancers and valuers, to make the process seamless and stress-free.
The best home loans often come with different features which fit your unique financial needs. And from home loan with a redraw facility to interest-offset mortgage accounts, there are many different types of home loans with varying features which can help you better manage your mortgage over the long term.
A good mortgage broker would be able to analyse your unique situation and recommend which home loan features are best for you. Engaging a mortgage brokers can help you save time and money and ease the process of shopping for a home loan.
Pull Your Own Credit Reports
Order your credit reports and scores from all major credit reporting agencies before you visit a bank or broker. Personal copies of current reports should provide enough details for them to give you an opinion of the types of loans they can offer you.
The lender you decide to use will access your credit files, but taking your personal copies to the initial interview avoids multiple credit pulls that can lower your scores. Requesting your own credit reports does not affect your scores.
The home buying process – from application, liaising with lawyers, compiling the documentation, and finally disbursement – can be a tedious, time consuming process. Good mortgage brokers guide you through this process and teach you how to buy so that you don’t stress yourself out.
So, if you are searching for the best home loans, mortgage brokers often come out on top of banks in securing the best mortgage loan for you.
How to Secure a Home Loan Quickly
If you are looking for good mortgage brokers because you are ensure of funds availability for purchase, the mortgage consultants at iCompareLoan can set you up on a path that can get you a home loan in a quick and seamless manner.
Our consultants have close links with the best lenders in town and can help you compare Singapore home loans and settle for a package that best suits your home or commercial purchase needs. Find out money saving tips here.
Whether you are looking for a new home loan or to refinance your existing one, the Mortgage broker can help you get everything right from calculating mortgage repayment, comparing interest rates all through to securing the best home loans in Singapore. And the good thing is that all our services are free of charge. So it’s all worth it to secure a loan through us.
For advice on a new home loan.
For refinancing advice.