What goes through your head when a Realtor suggests you work with their lender? Are you thinking, “is this person getting a kickback”? Or, “do they have my best interest in mind”? Both fair questions, and here is how it should work.
More often than not, if you’ve selected a trustworthy and reputable Realtor, they will also refer you a mortgage broker that is right for you, because this is what we do. I am a Realtor selling houses and condos for a living. It’s critical that I work with a mortgage broker who’s experienced to obtain the best loan program for you. Doesn’t that make sense?
In the event that you still feel uneasy, and I certainly understand if you do, here are some red flags to watch out for when using your Realtors mortgage broker.
The Mortgage Broker Your Agent Referred?
#1: It’s important for you to know that your home purchase can fall apart over choosing a Mortgage Broker that doesn’t act in your best interest, or doesn’t have the experience to obtain the best loan program for you. If you feel pressured to use the mortgage broker your REALTOR has picked out for you, this is a red flag to ask more questions or do a little research of your own.
Example: A homebuyer feels pressured to use a specific mortgage broker and therefore does not explore all possible options. The lender that mortgage broker works with is not able to close within 50 days. The seller decides against selling the home to that client and because the broker had not explored all loan options available, the client lost the opportunity to purchase that home. The upsetting part is the client was qualified to obtain a loan well within that time frame, but felt powerless to do so.
#2: You are not given legitimate reasons as to why your agent has referred the mortgage broker. Good reasons include past experience in successfully closing one or more transactions with that broker or the broker specializes in the type of loan your real estate agent thinks would work best for you.
#3: You aren’t able to verify that the mortgage broker is a licensed professional in the state your transaction is being performed. Many mortgage brokers are licensed in several states You can do this by going to http://www.nmlsconsumeraccess.org.
#4: You are not provided testimonials or references upon request and are not able to contact the mortgage broker directly. When a real estate agent has your best interest you will know it. They will truly care about you as an individual vs. their bank account by providing top notch customer service. Part of that service means making you feel comfortable throughout the transaction. Obtaining references and testimonials
#5: Granted a real estate agent is not supposed to know about obtaining a mortgage loan at the same level of a good mortgage professional, but they should certainly know enough to select a good one for you. If your Realtor seems to be unsure about basic topics like getting pre-qualified to purchase a home, what information you will need to provide a lender, what general loan programs are available to home buyers, etc. then you are right to question whether they have asked the right questions themselves. Please don’t work with a rookie Realtor – you’re hurting yourself.
The Mortgage Broker Your Agent Referred?
What questions can you ask the lender directly?
- Ask your mortgage lender what the best loan options are for you – they should be able to provide several options with different monthly payments, rates, and down payment options. Other good questions include:
- What types of mortgages do you offer?
- What are the best mortgages for me?
- Are you able to obtain the loan in enough time to close on my transaction?
- How do your rates compare and how does the Annual Percentage Rate translate over time?
Remember waiting to select a REALTOR or Mortgage Broker until you have found the home of your dreams is too late!
Transparency, expertise and the ability to legally perform the transaction in California or wherever you’re buying are important factors your Realtor should consider. If you don’t feel these topics are covered when one is referred, it should prompt you to do your own research before proceeding. Don’t be afraid to ask direct questions upfront and make sure you feel comfortable that you understand the response.
A good real estate agent will partner only with reputable mortgage brokers and a good mortgage broker can provide solutions and educate you in a way that will put your mind at ease and allow for a timely closing, cost saving, and stress reduction throughout your next real estate purchase.
Your Los Feliz Realtor Expert
I’m a local real estate agent and It would be my pleasure to help you find the perfect property to call home in Los Feliz CA, or if you’re thinking about selling a house, condo, or multi-family building in, Los Feliz, Silver Lake, Atwater Village, Glassell Park, Mount Washington, or Downtown Los Angeles, it would be a privilege to help you get top dollar for the sale of your property.
Lets chat sometime. 310-913-9477 or contact me.