Finding your dream home is just the first part of the process. Buyers must also secure financing to make their dream a reality. Working with a mortgage broker is an easy way to do it, as the broker can guide the buyer through the lending process from beginning to end. Most people have heard of mortgage brokers, but they may not know what these professionals do. Below, readers can find some more information about mortgage brokers in Wellington.
What Does a Mortgage Broker Do?
Mortgage brokers are best thought of as middlemen between borrowers and lenders. It is the broker’s job to work on the client’s behalf with New Zealand’s banks and to provide mortgage advice to potential homeowners. People often think that the terms “mortgage broker” and “loan officer” can be used interchangeably, but they are not the same.
Generally speaking, a mortgage broker is a regulated, licensed professional who works with a stable of reliable, established lenders. The broker does all the work, from gathering the necessary paperwork to pulling the client’s credit history and verifying their employment. Then, they use the information to apply for home loans on the buyer’s behalf.
How do Brokers Get Paid?
Like most professionals in the sales field, mortgage brokers receive a commission for services rendered. Most brokers charge loan origination fees, which are usually about one percent of the loan amount and are paid by the borrower during closing. However, some mortgage brokers negotiate no-fee loans to reduce the immediate burden on the borrower. Here, the broker receives payment after closing.
So, what makes a loan officer different from a mortgage broker? While a loan officer is a salaried employee of a lender, a mortgage broker works either with a firm or independently and earns most of his or her money in commissions. The bigger the loan, the higher the commission will be.