Top 10 Questions to Ask Your Mortgage Broker in Ontario
January 19, 2022 | Posted by: Barry Johnson
Top 10 Questions to Ask Your Mortgage Broker
The mortgage world can sometimes be difficult to navigate when buying a home. However, an experienced Mortgage Broker can help walk you through the process. Before settling on a Mortgage Broker, there are questions that you should ask. Explained below are the top 10 questions you should put into consideration.
1. What is The Fee for Their Services?
It is advisable to know the terms of engagement from the onset between you and the Mortgage Broker. Even though you would only need to pay the legal fees in most cases, it is necessary to ascertain this and get it out of the way.
2. What Should Your Budget Be?
Before viewing properties, consider knowing what your budget looks like and how much you can afford. This entails sharing your financial information with your Mortgage Broker, who comes up with a budget for you.
3. Which Loan Type to Pick?
Your Mortgage Broker should advise on the loan options you are best suited for. Their report is reliable since they have gone through your finances and are experts in the industry.
4. How Does the Mortgage Approval Process Work?
After going through your financials and being pre-qualified, application is the follow-up process. You can go through the preferable locations and submit your mortgage application. After offer acceptance, your Mortgage Broker will walk you through what is required next.
5. Can You Get a Loan Rate Lock?
Due to the volatile nature of interest rates, you might want to lock your loan for future purposes. It will protect you from higher interest rates. Additionally, enquire if there is a lock fee for your loan and if the lock-in protects all the loan costs.
6. What Are All the Costs?
A mortgage loan carries other fees such as lender fees, recording fees, third-party vendor fees, title policy, credit reports, taxes, and appraisals. Therefore, it is vital to get an accurate estimate in the Loan Estimate document with all the required information.
7. How to Save On Interest
There are options available to save on mortgage interest. For instance, making a sizeable down payment lowers your mortgage amount, resulting in a better mortgage rate. Your Mortgage Broker should avail you of the option available.
8. What Closing Costs Are There?
Usually, the loan is divided into two stages: one where you pay your interest and another where you begin to repay and pay off your mortgage. At this stage, you will be responsible for other fees such as appraisal, legal costs, transfer taxes, underwriting fees, and recording fees. Therefore, know how much to develop a suitable payment plan to avoid surprises.
9. Is There A Prepayment Penalty?
A prepayment penalty can be very costly if you pay it before the period has elapsed. Therefore, ask about the costs if you pay your loan off early. These penalties afford the lender and additional payment of unearned interest. Some are in effect for the short term. Hence it is better to get clarification from your Mortgage Broker.
10. How Much Time Will the Loan Take?
Your Mortgage Broker is best suited to know how long the loan process takes. It requires submitting all your essential financial information, such as bank statements and pay stubs. Inquire on any anticipated obstacles you should be aware of that could hold up closing on your loan. Additionally, you should ask for a timeline of when you should expect the closing day.
With you not being an expert in mortgages and the terms used, you will need an expert to hhelp guide you through the important journey of owning a home. It would be best to have a curious mind in everything you do not understand. Therefore, find a Mortgage Broker who meets all your needs and is patient with you.