Author Topic: How Does Everyone Feel About Mortgage Brokers?  (Read 1479 times)

RangerOne

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How Does Everyone Feel About Mortgage Brokers?
« on: November 14, 2017, 12:00:40 PM »
So I am trying to secure a loan for a purchase of a Condo. It is a pretty straight forward transaction as we are buying from my father in-law.

My mother in-law refereed us to a realtor we have used in the past who also happens to be a mortgage broker. I walked through all the terms and closing costs he could offer me and the interest rates and fees all seem competitive or aligned wit the best I could find. My sticking point is the broker fee...

I guess the industry standard is 1%-2% of the loan value. My question is does anyone find it worth to even have a mortgage broker?

He wants to charge us 1%, which will add $2500 to my side of the transaction. The other $2500 would be handled by the seller. I am not afraid to fill out paperwork and find my own notary. And possible pay a lawyer some fee to review final documents. But I feel like a mortgage broker is selling me a service that adds little value for me, as I would rather bust my ass than pay an extra $2-$3k. Even if it saves me time I don't feel like it is $5k worth of time. But then again I have never bought a home and I don't want to bite off more than I can chew if people on average think its worth the money.

I can get a similar loan for a little less than he offered from an online lender like Better Mortgage. I say a little better because they are quoting the same interest rates with a few hundred dollar kick back, with no loan origination fee which shaves off about $1k.


Enigma

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Re: How Does Everyone Feel About Mortgage Brokers?
« Reply #1 on: November 22, 2017, 07:15:16 AM »
I believe the 1% broker fee is pretty common.

Fishindude

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Re: How Does Everyone Feel About Mortgage Brokers?
« Reply #2 on: November 22, 2017, 07:17:46 AM »
I think it is an unnecessary layer of expense.
Just deal direct with your bank and eliminate the broker.

Car Jack

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Re: How Does Everyone Feel About Mortgage Brokers?
« Reply #3 on: November 22, 2017, 11:23:18 AM »
I've done refi's with mortgage brokers 3 times.  All were zero cost refis and if there was a broker's fee, it didn't get charged to me.

HawkeyeNFO

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Re: How Does Everyone Feel About Mortgage Brokers?
« Reply #4 on: November 23, 2017, 09:15:14 PM »
I used one twice.  No fee was charged to me, and he crushed the rates of Pen Fed, Navy Fed, and other banks.  On the last one, I even received several thousand dollars back at the closing.

Abe

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Re: How Does Everyone Feel About Mortgage Brokers?
« Reply #5 on: November 23, 2017, 11:01:29 PM »
A broker helped me get a mortgage when the banks were being idiots and refusing to lend me money because I didn't use a credit card and paid in full for my car, thus had no "debt history". I ended up with a much lower rate that saved me much more than the broker fee.

rpr

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Re: How Does Everyone Feel About Mortgage Brokers?
« Reply #6 on: November 24, 2017, 12:13:31 AM »
So I am trying to secure a loan for a purchase of a Condo. It is a pretty straight forward transaction as we are buying from my father in-law.

My mother in-law refereed us to a realtor we have used in the past who also happens to be a mortgage broker. I walked through all the terms and closing costs he could offer me and the interest rates and fees all seem competitive or aligned wit the best I could find. My sticking point is the broker fee...

I guess the industry standard is 1%-2% of the loan value. My question is does anyone find it worth to even have a mortgage broker?

He wants to charge us 1%, which will add $2500 to my side of the transaction. The other $2500 would be handled by the seller. I am not afraid to fill out paperwork and find my own notary. And possible pay a lawyer some fee to review final documents. But I feel like a mortgage broker is selling me a service that adds little value for me, as I would rather bust my ass than pay an extra $2-$3k. Even if it saves me time I don't feel like it is $5k worth of time. But then again I have never bought a home and I don't want to bite off more than I can chew if people on average think its worth the money.

I can get a similar loan for a little less than he offered from an online lender like Better Mortgage. I say a little better because they are quoting the same interest rates with a few hundred dollar kick back, with no loan origination fee which shaves off about $1k.

I'm a little confused by the post. Maybe there is confusion between you and the broker as well. Maybe the broker is charging a fee for the real estate transaction and not for the mortgage loan. Since you do not appear to have a buyers/sellers agent, maybe the mortgage broker is expecting that they will be putting together the paperwork for the closing.

happy

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Re: How Does Everyone Feel About Mortgage Brokers?
« Reply #7 on: November 24, 2017, 03:37:33 AM »
Things might be different here Down Under, but mortgage brokers can be very helpful in finding just the right deal. I used one for my latest RE project and was very happy with the outcome, which I don't think I would have achieved on my own.  In our country the bank pays the broker a handsome commission for landing the loan, so there is no direct fee to the customer. Of course borrowers must pay for this indirectly - but I got a better loan at a better interest rate than I would have been able to negotiate myself.

Cubert

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Re: How Does Everyone Feel About Mortgage Brokers?
« Reply #8 on: November 24, 2017, 04:25:06 AM »
All solid tips here. Main thing is to shop around, and look for a combination of reasonable rates plus reputation. I use US Bank for my mortgages on our rentals and have zero complaints.

Best!

joonifloofeefloo

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Re: How Does Everyone Feel About Mortgage Brokers?
« Reply #9 on: November 24, 2017, 07:02:20 AM »
Like many here, I swear by them. I don't recall paying a fee to use one.

clarkfan1979

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Re: How Does Everyone Feel About Mortgage Brokers?
« Reply #10 on: November 24, 2017, 10:38:51 AM »
If you are buying a primary home, I have found that local credit unions have the lowest costs for a loan. For some credit unions, they don't provide a transaction fee for the person assigned to the loan. This provides some nice savings. However, the person from the credit union doesn't always care if the loan doesn't go through. That can be frustrating.

Many credit unions will not provide loans on rental property. As a result, I typically use a mortgage broker for loans on rental properties.

I just re-fied a rental property for a 262.5K loan on a 350K single family rental.

Origination Loan Fees: $1300
Appraisal: $700
Title Services Fees: $1100

Total cost of $3100 in fees. If it was a loan for a primary home, I think the total fees would have been around $2,500.