Engaging in the services of a mortgage broker in Vancouver is a major decision in your life. It is one that should come with a lot of thought and questions. Your relationship with your mortgage broker should be a lasting one, being that you will regularly see each other for years to come, until such time you fully pay your mortgage. Here’s a list of questions that you can ask a mortgage broker before finally deciding on one:
1. Can I see all your licenses and permits?
When you apply for a mortgage, this is a financial contract that will tie you up for years. Just as is the case with any other financial commitment, it is essential that you are dealing with someone who is operating legally. You don’t want to face any trouble later on in the future only because you were dealing with a broker that is not licensed.
Ask about the following:
You can also double check the presence of these licenses and permits by visiting the mortgage company’s website, such as https://www.geoffleemortgage.com/.
2. What type of mortgage is the best for me?
Because you are there to contract a loan, it is but natural that you should ask about the type of mortgages that are best for you. When you ask this question, you can have an overall idea as to whether or not you are dealing with a broker who is genuinely concerned about helping you as well, or if you are talking to someone who is only in it for the money.
The best way for you to balance this out is to ask about the pros and cons of each loan offer. The broker that you are talking to should be honest enough to discuss the disadvantages as well.
3. How many years have you been in this industry?
You should be dealing with a broker who has years of experience under their name. You cannot exchange expertise with anything else, and the years of experience is one of the top indicators of this expertise. When you take out a mortgage, you take out a massive chunk of money that you are liable to pay for years to come, hence it is essential that you do not make the mistake of putting your trust and hard-earned cash on a broker that is not even well-versed in the industry.
4. What is the annual interest rate?
You may be surprised to find out that a lot of individuals who are first-time applicants for a mortgage usually forget to ask about the annual interest rate. Remember that the amount you will be paying per month can increase as the years progress depending on the interest rate.
Also, the amount that you pay for is usually comprised of the fixed amortization you have to pay per month, plus an add-on for the interest rate. You should, therefore, ask about the interest rate, so that you can use this as a comparison factor between various loan or mortgage offers.
5. How much down payment is needed?
Apart from the interest rate itself, the amount that is needed for the down payment is also one factor that you should have in mind as a consideration. A great mortgage broker should be able to walk you through the advantages and disadvantages of different down payment rates.
Ideally, the down payment should be pegged at 20% of the total amount of the property. However, to make homes and mortgages more accessible, nowadays, some brokers offer little to no down payment at all, or a down payment that you can pay in installments as well.
6. What is the entire schedule of fees that will be involved in this whole transaction?
One of the most critical questions that you should also ask your lender is regarding the entire schedule of fees of the whole transaction. You should ask about this because there are many lenders that, unfortunately, may try to sugarcoat some aspects in exchange for closing a deal faster. Hence, once you’ve already signed your mortgage contract, you will be surprised to find out later on that there are more add-ons and hidden fees.
An excellent mortgage broker should be transparent about all the costs, without hiding any aspect of it at all to make the contract seem cheaper than it actually is. There are many horror stories of couples looking for their first family home who have failed to ask their mortgage broker about the total costs, and were later surprised to discover that additional costs have amounted to over 10,000 to 15,000 USD, which they weren’t informed about. You do not want to be in this kind of predicament.
7. Is mortgage insurance necessary?
First-time homebuyers may not be very well versed about the other requirements needed to complete the loan. One of these aspects concerns mortgage insurance. There are some transactions where this is required, while for others, you may not need this at all. When in doubt, ask your mortgage broker as they are more knowledgeable about this matter.
As a general rule, however, most transactions that have a down payment amounting to less than 20% need mortgage insurance.
8. How much time do you need to complete the loan contract?
Most mortgage contracts usually take about three to eight weeks before its completion and turnaround. If you are still torn between numerous options and brokers, and most especially if you are time constrained to have the mortgage contract finalized as soon as possible, this time of completion can be one of your deciding factors as to which mortgage broker to sign the final deal with.
Concerning this, the broker should also be transparent about possible problems that can commonly cause delays along the way, so that you are also aware of all these other factors.
These questions can help you narrow down your numerous options of mortgage brokers in Vancouver. Remember that you have to build your relationship based on trust and confidence, and these questions can help you achieve the same. If you are not satisfied with their answers, or if you feel that something may be off, then perhaps it is better if you choose another broker instead.