Mortgage brokers connect prospective mortgage borrowers to the lenders with whom they operate. The “broker vs bank” debate has been a heated one for a long time, and this is for good reason. While you might trust your bank, this doesn’t mean that a mortgage broker is an option that should be cleared from the table. In this article, we’ll explain what mortgage broker does and why they are such a great resource for many home buyers in Canada.
Mortgage Brokers Will Work with Different Circumstances
Traditional lenders, like banks, want to see a very specific set of documentation before they’ll facilitate a mortgage loan. Most notably, they’ll need to see a copy of financial statements – and very particular ones, at that. Paycheck stubs and W-2s, for instance, are typically sought after. But what happens if you are self-employed? With so many individuals veering toward freelance or contract work, this has become a serious issue.
And the solution to this problem can oftentimes be a second mortgage broker.
Mortgage brokers know how to work with the information that you can provide, rather than disqualifying you because of the information that you can’t. With the documents that you have available as a self-employed individual, they can still connect you to a variety of lenders!
If you’re employed in a traditionally documented job but still have to fight against poor credit, a mortgage broker can be a real helping hand, too. A bank is very likely to turn away a client with damaged credit, but mortgage brokers don’t only work with banks. They have access to many different avenues of borrowing, including private mortgage lenders. A broker may be able to facilitate a relationship between a person with damaged credit and a lender that will gladly work with them.
You Have More Options on the Table
A bank agent will not point you toward other lenders when you inquire with them about receiving a home loan. Why would they, if it could deter you from taking out a loan with their institution? A mortgage broker, however, has no such obligations to any lender. They work for their clients, not lenders, and essentially act as a middle-man between lenders and borrowers.
This means that you will be given information about loan amounts and rates that you qualify for through a variety of lenders, with no pressure involved! You won’t be expected to commit to any loan that the broker shows you as available if none of them appeal to you. You might even be able to find a lender that you’d never heard of, or one that you thought was out of reach all along.
You Don’t Have to Pay for Their Services
Mortgage brokers are not paid by their clients. Instead, they are paid by the lenders with whom they have connections. This means that you can make use of this valuable resource without expecting to shell out any of your hard-earned funds!
Mortgage brokers are an invaluable asset that many modern home buyers utilize as they pursue the goal of owning their very own home. Don’t dismiss the benefits of a mortgage broker, even if you love your current bank! It never hurts to know what options you have before you.