Step 5: How to Build Your Mortgage Team
Even though owning a home is an individual’s or couple’s sole responsibility, it takes a team effort to get them from the shopper stage to the homeowner stage. Building a team of capable, trustworthy, and experienced professionals make the entire process move along much smoother. Two of the more important members of any home buying team should be:
- Mortgage Lender / Broker
- Real Estate Agent
Finding the Right Mortgage Lender / Broker
The first decision a borrower needs to decide is whether they need a mortgage lender or a broker. A broker is a professional in the real estate industry who serves as a liaison between the buyer and the lender. This person is responsible for doing all of the work in finding the best lender for the buyer’s needs.
However, as helpful as a good broker can be, a buyer needs to practice caution if they want to use one. There are some brokers out there that don’t work in the best interest of the buyer, but rather, they connect the buyer with the lender that promises the broker the highest profit.
Therefore, before selecting a broker or a lender, the buyer needs to do their due diligence before making a final selection for their team. Here are some tips to help you partner with the right lender or broker for your unique home buying needs.
- Research: Before you start talking seriously with lenders or brokers, do a thorough amount of research. Make sure the people or firms you are considering are reputable and licensed in the state where you are buying a home. They should be able to provide a list of prior clients that you can get in contact with. You can also ask for referrals from people you trust who have recently purchased new homes.
- 3 Offers: Once you have an idea of what type of loan you want to apply for, get at least three offers from three different lenders. This will help ensure the lender you use offers the type of loan you want, as well as determine if any of them are charging extraordinarily high or unreasonable fees.
- Compare Costs: There are dozens of fees associated with buying a home, from the home inspection to survey costs. The interest rate can vary between lenders as well. Compare all of the costs presented in your quotes. Is one lender charging a lot more in fees or quoting you a higher interest rate than the others? If so, remove that lender from consideration.
Choosing a Real Estate Agent
A home buyer needs to connect with their real estate agent on a personal level. They need to like them and trust that they are working hard on their behalf. A good real estate agent can be an incredibly valuable source of information and advice when a buyer is looking to make a home purchase. They can provide the buyer with plenty of answers related to the area of interest, including:
- The average housing costs in the area
- The cost of living in the area
- Quality of the schools
- Conveniences, such as stores, pharmacies, libraries, etc.
- Location of police, fire, and medical services
- Best places to eat or visit
- And more
Like choosing a lender or a broker, there are a few things a buyer is going to want to consider before making this important decision. For instance, a buyer should verify the agent’s licensure and speak with the agent’s most recent clients. The buyer should take a look at the agent’s current listings and ask about their credentials. It is always a good idea to use an experienced agent, but that shouldn’t stop a buyer from using a new agent. New agents are hungry for a sale and will often go further out of their way to satisfy their clients. Another important question the buyer should ask is whether or not the agent has experience selling the type of home they’re interested in buying.
Once the buyer is satisfied that the team that’s being assembled is the right one for their needs, the process of buying a new home becomes easier and all the more enjoyable.