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Sticky · 03-22-2005, 07:14 AM

A mortgage broker is not affiliated directly with any one bank (although they may have a good relationship with some banks).
They are able to see rates from various institutions including the major 6 banks and other financial institutions and get you the best rate possible.
They know more than the average home buyer/mortgage seeker and should be able to help you get a better rate with any specific terms that you want.
Remember to tell the mortgage broker that you want the financial institution to pay for the:
- inspection
- Notary fees (or legal fees)

You don't pay the mortgage broker anything (somebody will correct me if I am wrong). The mortgage broker gets a commission from the financial institution where the mortgage is placed.

This is good and bad.
The good part is that you don't have to pay for this service which could be a very big benefit.
The bad news is that the mortgage broker has their own agenda that is not necessarily in sync with yours. They want the most commission you want the best deal. those tow will not always be in line. They may prefer a certain institution becuase they get a better deal. They may also just me happy with placing your mortgage anywhere and making whatever they make.

All I am saying here is that you have to remember your own interests when making your mortgage decision.

Also, nothing stops you from looking for a mortgage on your own while at the same time using a mortgage broker. In fact some financial institutions don't allow mortgage brokers. For example, you can get a great rate from ING Bank but you cannot use a mortgage broker.

The realtor is not paid by you.
Both the sellers and buyers realtors share a percentage of the sale.

In my opinion this system does not benefit the buyer. Becuase the buyer's realtor is making a percentage of the sale price they are not interested in getting you the best price (this means less comission for them), they are just interested in geting you to buy it.
You may hear things from them like, "it is only another $10,000, what is that over the 25 year life of the mortgage".

Damn I hate that. What the hell do they know hom much I can afford.

At the same time a realtor has a lot of benefit of you have not purchased a house before. There is a lot that they can help you with with the procedures of putting in offers and counter offers. They also know how the seller's realtor works. Remember you are not dealing with the seller you are dealing with their realtor.

If you know exactly which house it is that you want, it may save you a few thousand dollars to use the sellers realtor. Becuase they will be the realtor for the seller and the buyer, they get to keep the whole commission for themselves. This means that when you and the buyer are not able to come together on a price you may have room to move with the realtor. The realtor can give up some of the commission to the seller instead of the seller haveing to come down further in price and you having to come up. They should be willing to do this becuase if you had chosen a different realtor they would have had to gove half (or part) of the commission to the other realtor.

Whicever way you go, just as I said with the mortgage broker - keep the above in mind. If you understand everybodies bias it may actually be more beneficial to you in using them over not using them as you can possibly gain more information and understand more from reactions or the things that they say.

All that being said, I used a realtor when buying a house and a mortgage broker. While I did not like all the three realtors that we went through (in approx 2 years) and the first mortgage broker that we tried to use, I do see the benefits of using both.

The mortgage broker (even the one we did not like) was albe to get us a much better rate that we fel we would ever have been able to get on our own.

03-22-2005, 07:14 AM	#3 (permalink)
Sticky	A mortgage broker is not affiliated directly with any one bank (although they may have a good relationship with some banks). They are able to see rates from various institutions including the major 6 banks and other financial institutions and get you the best rate possible. They know more than the average home buyer/mortgage seeker and should be able to help you get a better rate with any specific terms that you want. Remember to tell the mortgage broker that you want the financial institution to pay for the: - inspection - Notary fees (or legal fees) You don't pay the mortgage broker anything (somebody will correct me if I am wrong). The mortgage broker gets a commission from the financial institution where the mortgage is placed. This is good and bad. The good part is that you don't have to pay for this service which could be a very big benefit. The bad news is that the mortgage broker has their own agenda that is not necessarily in sync with yours. They want the most commission you want the best deal. those tow will not always be in line. They may prefer a certain institution becuase they get a better deal. They may also just me happy with placing your mortgage anywhere and making whatever they make. All I am saying here is that you have to remember your own interests when making your mortgage decision. Also, nothing stops you from looking for a mortgage on your own while at the same time using a mortgage broker. In fact some financial institutions don't allow mortgage brokers. For example, you can get a great rate from ING Bank but you cannot use a mortgage broker. The realtor is not paid by you. Both the sellers and buyers realtors share a percentage of the sale. In my opinion this system does not benefit the buyer. Becuase the buyer's realtor is making a percentage of the sale price they are not interested in getting you the best price (this means less comission for them), they are just interested in geting you to buy it. You may hear things from them like, "it is only another $10,000, what is that over the 25 year life of the mortgage". Damn I hate that. What the hell do they know hom much I can afford. At the same time a realtor has a lot of benefit of you have not purchased a house before. There is a lot that they can help you with with the procedures of putting in offers and counter offers. They also know how the seller's realtor works. Remember you are not dealing with the seller you are dealing with their realtor. If you know exactly which house it is that you want, it may save you a few thousand dollars to use the sellers realtor. Becuase they will be the realtor for the seller and the buyer, they get to keep the whole commission for themselves. This means that when you and the buyer are not able to come together on a price you may have room to move with the realtor. The realtor can give up some of the commission to the seller instead of the seller haveing to come down further in price and you having to come up. They should be willing to do this becuase if you had chosen a different realtor they would have had to gove half (or part) of the commission to the other realtor. Whicever way you go, just as I said with the mortgage broker - keep the above in mind. If you understand everybodies bias it may actually be more beneficial to you in using them over not using them as you can possibly gain more information and understand more from reactions or the things that they say. All that being said, I used a realtor when buying a house and a mortgage broker. While I did not like all the three realtors that we went through (in approx 2 years) and the first mortgage broker that we tried to use, I do see the benefits of using both. The mortgage broker (even the one we did not like) was albe to get us a much better rate that we fel we would ever have been able to get on our own. __________________ Sticky The Stickman