What is a Mortgage Broker?
A mortgage broker is an independent real-estate financing professional who specializes in the origination of residential mortgage loans. Mortgage brokers normally pass the actual funding and servicing of loans on to wholesale lending sources. A mortgage broker is also an independent contractor with access to loan programs from many different Lenders. By combining professional expertise with direct access to hundreds of loan products, your broker provides the most efficient way to obtain financing tailored to your specific financial goals.
What Do Mortgage Brokers Do?
In the volatile home-lending market, mortgage brokers can serve as safeguards, offering their clients security, safety, and peace of mind. One of the broker’s most important functions is escorting your loan application through the entire process, constantly patrolling the component transactions for possible breakdowns. A professional mortgage broker can wade through the mountains of rate data and program options, researching current market conditions to find the most accurate and up-to-date information about cost-effective loan options.
Difference between mortgage planner and mortgage broker
What is a Mortgage Planner?
All mortgage planners are mortgage brokers, but all mortgage brokers are not necessarily mortgage planners. The difference is the long-term approach that mortgage planners take with the relationships they have with their clients.
Your goals are our goals
Mortgage planners ensure your goals and needs are first and foremost when making recommendations, They do not make suggestions to maximize their commission. Mortgage planners consider rates and prepayment privileges, portability options, and other terms and conditions of the mortgage or lending. A mortgage planner would not recommend a product if it does not fit your lifestyle, plan, or necessities.
Evolution of your mortgage
Another difference between a mortgage broker and a mortgage planner is that a mortgage planner wants to be with you as you grow and evolve. They wish to assist at every stage of your life, from being a first-time home buyer, purchasing a vacation home, building your dream home, or accessing the equity from your home through a reverse mortgage to help you in retirement. Mortgage brokers tend to complete the task at hand to help you with your immediate mortgage needs.
Mortgage planners are willing to assist you with answers to your questions or advice, even if it doesn’t eventually turn into a sale or commission for them. Therefore, picking a mortgage broker who is also a mortgage planner is paramount to getting expert advice on what you truly need now and how to attain your dreams in the future.
Your credit score
Your credit score is important and will be a determining factor in the mortgage process. All mortgage lenders must determine your “ability to repay” the mortgage you request, and the data contained in your credit report will help document some of your required monthly payments. The FICO credit score you receive from credit bureaus also has a direct impact on the pricing you will receive from your Lender, The higher the score the better the pricing, So it’s Important you have a thorough understanding of your credit score. Kathy Nau will review your credit report with you in detail and pursue every opportunity to make sure it is accurate, resulting in the highest score possible. Here are a few other resources you might find helpful in understanding the importance of your credit score.
What Makes Up Your Credit Score?
By design, your credit score comes from the information found on your credit report. If an item doesn’t show up on a credit report, it can’t affect your score.
For example, your bank account balance doesn’t appear on your credit report. Neither does your income or your net worth. None of these factors play a role when a scoring model calculates your credit score.
Factors that do impact your FICO Score fall into one of the following five categories.
- Payment History: 35%
- Amounts Owed: 30%
- Length of Credit History: 15%
- New Credit: 10%
- Credit Mix: 10%
In each category, a scoring model will ask questions about your credit report. For example, “Does the report show any late payments?” These questions are known as characteristics in the credit scoring world. The answers to these questions, called variables, determine the number of points you earn. When the scoring software adds all of those points together, you get your credit score.
Why Get Preapproved
5 Reasons to Get Pre-Approved Before You Begin House Hunting
Getting ready to buy a home? One of the things you can do as part of the home-buying process is to get formally pre-approval with Kathy Nau. Why? You’ll know how much house you can afford and a pre-approval lets real estate agents know you have the finances lined up and ready to go.
The first step in getting pre-approved is to complete our loan application. You’ll need to submit documentation of your financial history, including income, assets, and debts. We’ll-ask you to provide at the minimum the following documents:
- W-2 statements
- Paystubs
- Bank statements
- Tax returns
Benefits to getting pre-approved
Wondering if it’s worth it to get your finances in order before you start house shopping? Here’s 5 reasons why you should:
- You’re a more powerful buyer: Real estate agents and sellers will see you as a serious buyer when you have the backing of a lender. Pre-approval means a lender has looked at your financial background and determined how much home you can afford.
- Save yourself some time: Getting pre-approved can also save you valuable-time by identifying how much you can afford, so you can target your home search to your price level. This also allows you to focus on the features of the home rather than worrying about the price tag.
- Better bargaining power: With a pre- approval letter in hand, you will likely: have more negotiating power because sellers and real estate agents. know that you have already talked to a lender and you mean business.
- Reduce surprises: Talking to Kathy Nau before finding your perfect home can help ensure you’re not surprised when it’s time to make an offer. Getting your ducks in a row early will leave little room for unexpected surprises – such as a low credit score or a less than desirable debt-to-income ratio – when you find the home you’ve looking for.
- Enjoy shorter closing periods: A pre-approval can help to speed up the closing process, since much of your financial information is already collected and in-the lender’s system.
Once you submit your financial information, Kathy will complete her evaluation of your information and provide you with a pre-approval letter outlining the maximum you’re qualified to borrow.
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Refinancing Your Home Loan
People refinance their home loans for many reasons. Often times for a lower interest rate should they drop after you have financed your home current home loan. Sometimes a divorce occurs necessitating one party to refinance the other party off of the loan. Taking cash out of the home when equity rises are many reasons people refinance — using those funds to consolidate debt, remodel your home or pay for tuition expenses for children. And refinancing to a shorter term in order to payoff your mortgage faster and meet your retirement goals. We will review your specific needs and ensure if a refinance of the existing loan accomplishes the goals you desire.
