5 Questions to Ask Your Mortgage Broker About their Lender Network
Brokerage Tips
5 Questions to Ask Your Mortgage Broker About their Lender Network
Navigating the complex world of mortgages can be daunting, but the right questions can unlock the door to a better deal. This article demystifies the lender network through the lens of seasoned mortgage professionals. Gain insider knowledge on how to evaluate a broker's network, ensuring a choice that aligns with your financial goals.
- Ask About Network Breadth and Diversity
- Inquire About Diverse Lender Network Benefits
- Question Broker's Lender Access and Usage
- Ask About Lender Experience and Affiliations
- Ask About Number of Active Lenders
Ask About Network Breadth and Diversity
When speaking with your mortgage broker, ask them about the breadth and diversity of their network of lenders, including whether they work with a mix of major banks, credit unions, and independent lenders. This will give you a sense of the range of options available to you. Additionally, inquire how they evaluate these lenders to ensure competitive rates and terms. To ensure your broker has access to the best options, choose one that is not tied to a specific institution or limited in their partnerships. A broker with a broad network and experience navigating various financial scenarios is more likely to tailor solutions to your unique needs.
Inquire About Diverse Lender Network Benefits
"How diverse is your network of lenders, and how does it benefit me?
When you're choosing a mortgage broker, you're not just picking someone to crunch numbers; you're selecting someone with the connections to shape your financial future. A strong, diverse network of lenders - like the 90+ options we have at LBC Mortgage - means more than just choice. It means leverage.
A wide network ensures your broker isn't boxed into one-size-fits-all solutions. Instead, they can tailor options to your unique needs. Research shows that access to more lenders often results in better rates, terms, and flexibility. It's like shopping at a gourmet market versus a gas station convenience store.
To ensure you're getting the best, ask about the broker's relationships with their lenders. Are they direct? Established? Do they have lenders who specialize in your type of loan? The right broker has already done the homework, so you don't have to."
Question Broker's Lender Access and Usage
To ensure you are getting access to the best network of lenders from your mortgage broker, it's important to know how they operate. Here are a few questions to ask.
1. How many lenders do you have access to?
2. Over the last 12 months, how many lenders did you use?
3. Out of the lenders you have used over the last 12 months, what percentage did you use with each lender?
4. Are there any loan programs that you currently don't have access to with your current network of lenders? If so, what are they?
5. Who are your top 3 lenders and why do you use them the most?
By asking these 5 questions, you will get a better understanding of how they operate. The main thing to consider is if the mortgage broker is shopping on your behalf for the best deal. If they are only using less than 5 lenders within 12 months, it may be signs that they are only using lenders that are convenient for them, not necessarily finding you the best deal. However, it may be they have selected the lenders based on price and deliverability. Therefore, it's important to dive into questions about how they choose the lenders they have used.
Ask About Lender Experience and Affiliations
In New Zealand, where we operate, the client does not pay to use a Mortgage Broker, the lender does. This is helpful because the client can rest assured that the broker is simply working to get the best deal for them, rather than a commission.
However, it's still useful to ask questions such as:
1) How many lenders are you working with?
2) Do those lenders have experience with clients such as myself?
3) Do you have any preferred lenders and why?
4) Do you have any personal affiliation with any lenders that I should be aware of?
5) Can I get special rates since I'm using your service?
Clients are more than welcome to talk to a variety of brokers, including their own bank. In fact, we encourage it, our simple goal is - best deal for the client, because a happy client will speak positively about us, and then the business will naturally do well.
Ask About Number of Active Lenders
Many mortgage brokers only use one or two lenders.
You should ask "How many mortgage lenders do you have access to and how many are you actively sending loans to?"
If most loans are going to a single company, that's a huge red flag.
