Mortgage brokers play an important role when you’re buying a home. Not everyone buying real estate in Lethbridge has all of the cash in their personal bank account. A mortgage broker should be a neutral third parties who can help you find the best mortgage for your needs and situation. A good broker will help you understand your options and make sure you get the right mortgage for your circumstances. But how do you know if a broker is looking out for your interests or not? Ask these top 10 questions when interviewing potential brokers to hire. A good broker will give you trustworthy answers that make it clear they have your best interests at heart.
What is your licensing and accreditation?
A good place to start is making sure your broker is fully licensed and accredited, and keeps their information up to date. Licensed brokers should have their details listed on the Alberta Mortgage Broker Association website and must be licensed through the Real Estate Council of Alberta. Accreditation is granted by the Canadian Mortgage Brokers Association and is a good indication of regulatory oversight. If your broker isn’t licensed or accredited, move on to another one.
Who is the lender you’ll be working with?
Any good broker should be willing to tell you who they’re working with and why. A legitimate mortgage broker will work with a number of different lenders. Generally, the broker gets paid based on the interest rate they can negotiate for you, so they have no reason to push one lender over another. But if your broker only works with one lender, there may be a conflict of interest.
What are my mortgage options?
A good broker will walk you through all your options. Look for one who will start by asking you what your borrowing needs are. Make sure they don’t go straight to listing the most expensive options first. Remember, a mortgage broker is not a financial advisor. They don’t have the same legal obligations to you as an advisor would. A good broker will help you find the best product for your needs and situation. He or she will not tell you what is best for your specific financial situation.
What happens if I don’t have 20% for a down payment?
A good mortgage broker will have a variety of solutions that fit your specific needs and financial situation. If you don’t have the full 20% down payment, make sure your broker understands your individual situation and has a solution that works for you. For example, a broker may be able to arrange a private mortgage for you at a higher rate (e.g., 8% instead of 5%) because you won’t have the money saved up as equity in the property right away. Make sure you understand all the terms of the deal and what it will mean for you in the long run.
Should I consolidate my debt before getting a mortgage?
Generally, experts say no. It’s generally not a good idea to take on new debt when you’re applying for a mortgage because it can affect your credit score. But if you have high-interest rate debt, such as credit card debt, a mortgage broker can help you explore your options for consolidating that debt. A broker can help you find a reputable debt consolidator and make sure the terms are fair.
What conditions are in the market right now?
A good broker will be knowledgeable about the current state of the market. Make sure they understand how conditions might impact your ability to qualify for a mortgage. They should also be able to advise you on how to best manage your finances to make sure you’re ready to buy a home when the time is right.
What happens if rates go up instead of down?
A good mortgage broker should be prepared for all possibilities. They will know what to do if rates go up. They should have a plan for helping you find a good solution if the amount you can borrow goes down. If your broker doesn’t have a plan for all possible outcomes, find another broker.
Should I lock in or receive Variable rates?
A good mortgage broker should be able to help you decide on the best course of action for your specific situation. If you’re not sure what to do, make sure your broker understands your individual situation and is able to advise you on the best choice.
Can you recommend reliable mortgage advisers?
A good broker will have a list of advisers they work with regularly. Mortgage brokers don’t have the same set of regulations that financial advisors do. Make sure whoever your broker recommends has the proper credentials to advise you on your mortgage. A mortgage broker can refer you to an adviser who can help you with the rest of your financial planning.
Summing it up
In the end, a good mortgage broker is an important part of your home buying journey. They can help you find the right mortgage, understand your options, and manage your finances throughout the process. There are lots of questions you can ask as you interview potential mortgage brokers. But these 10 are a good place to start. They will help you weed out the brokers who don’t have your best interests at heart and find the ones who do.