Just like any other financial situation, mortgage brokers and lenders will tell you all the wonderful things about choosing them for your home mortgage, but they’ll neglect to mention the disadvantages. There are many details you should know so you avoid become just another victim. For example, the APR-the annual percentage rate of a mortgage-is the interest rate including the cost of points and other fees like private mortgage insurance. Mortgage brokers are companies that serve many different banks and lenders; they can be very useful and provide you with the variety needed to find the ideal financial situation. Sometimes getting bank financing through a broker can be even cheaper than talking to the bank’s own internal salespeople. Advantages continue: You can get cheaper APR mortgages, you can re-lock your APR if the market interest rates drop, and you can usually quickly find a loan for which you may qualify. On the other hand, brokers have to courier papers between lenders, so postage charges can reach about $200 before your loan charges. Also, more dangerously, there are unscrupulous brokers out there who want to steer you into your wrong mortgage that charges fees or doesn’t allow early termination.
