(And Other FAQS)
Finding the right financing for your needs can be an overwhelming process. I’m here to simplify it. Some of the questions people typically ask me are listed below along with answers, but if you do not see your question answered here, contact me, and I’ll be happy to help.
What is a mortgage broker/loan originator?
A mortgage broker (mortgage consultant) is a real estate financing professional who links you with the appropriate lender for mortgage or home equity transactions. Mortgage brokers work closely with lenders (mortgage companies, banks, credit unions, etc.) to provide you with a wide selection of mortgages. In the Commonwealth of Massachusetts, which is where Westchester Mortgage operates out of, mortgage brokers need to be licensed. The official term is “mortgage loan originator license.”
Who is required to have a mortgage loan originator license?
Before July 1, 2008, only owners of mortgage companies needed to have a license. After July 1, 2008, any individual who takes a residential mortgage loan application has to be licensed.
How do mortgage brokers get paid?
On April 1, 2011, there was a change in how mortgage brokers/licensed loan originators get paid. Currently, a loan origination fee is paid by the lender or bank to the loan originator who initiates and completes the loan transaction with the homeowner. This is paid out only if and when the loan funds. Mortgage loan originators may not be paid based on the terms and conditions of the loan. The new rule also prohibits “steering” a consumer to lenders offering less favorable terms in order to increase the loan originator’s compensation. Mortgage brokers/licensed loan originators have a set percentage that they receive on the loans. So the percentage is the same for a $50K loan and a $500K loan. It is the same whether it is an adjustable-rate or a fixed-rate.
Why should I use a mortgage broker? What are the benefits?
A mortgage broker will save you time and money. The Internet is full of potential lenders claiming to offer the lowest rate. This “low-ball” bait and switch approach is fraught with risk as lenders try to get you in the door with rates they can never honor. These rates come with hidden fees and exorbitant expenses.
A mortgage broker can help you sort fact from fiction and find the best financing solution for you.
Because Westchester Mortgage is not affiliated with only one lender, I can offer an unbiased recommendation on which program is best for you. Since I deal with hundreds of lenders, I can find you the best rate and options based on your needs.
There are other benefits to working with mortgage brokers. Typically, we are…
How does a mortgage broker save me time?
While you’ll certainly be able to find volumes of detailed, important lending information on the Internet, do you really have the desire or the time to effectively evaluate it all and make the best choice? Save time and frustration by using a mortgage broker like Westchester Mortgage to help you understand the process and meet your financial needs.
Remember, mortgage brokers operate in a heavily regulated industry. As mortgage brokers, we have education requirements, we are governed by rules of conduct, and we have an insider’s understanding of mortgage products.
At Westchester Mortgage, I do most of the work leading up to your loan. You can count on me to:
Bottom line: I’ll save you time. There is no need for you to track rates daily or seek out the best program from several options. I work closely with you to understand your current situation and your goals and then I match you with a program that best meets your needs. And one final note: when you choose me, you get ME. I don’t hand you off to associates or assistants.
What should I look for in a mortgage broker?
A mortgage is a loan for which your home serves as collateral. Entrusting someone to help you find a mortgage is an important decision. This person is helping you deal with one of the biggest financial assets of your life. Before choosing a mortgage broker, ask the following questions:
When it comes to me, you can find answers to the above questions by visiting my About page and My Approach.
What will I need when completing a loan application?
The documentation required differs by individual and by the lender, so please call me at 617-965-1236 for a sample checklist of the documentation you should be prepared to provide. However, to give you an idea, below is a list of the minimum documentation required from the borrower and any co-borrower:
For a more comprehensive list, see our Required Documentation page.
With so many programs to choose from, how do I know what program I should apply for?
There are numerous programs available and it is important that you be aware of all your options so you can make the best choice. When you work with Westchester Mortgage, I help educate you on the options available. I review all the product choices and come up with the best fit depending on your goal for the refinance or purchase. I always take your goals, income, asset position, and credit history into consideration. However, I go beyond that and ask questions, such as these:
What is the difference between choosing a fixed-rate mortgage or a variable-rate mortgage?
Security and Stability: Fixed-Rate Mortgage
This is the most popular type of mortgage. Your interest rate, principal, and interest payments stay fixed for the life of the mortgage, resulting in predictable housing payments. People who choose fixed-rate mortgages do not want a lot of risk in their financial picture. Often they intend to stay in the same home for many years. They are willing to pay a slightly higher interest rate to be guaranteed that it will not go up during the life of the mortgage.
Flexibility and Control: Adjustable-Rate Mortgage
These programs are designed to keep your starting mortgage payments lower than a fixed-rate loan. This saves you money early on, and may help you qualify for a more expensive home. There are several types of adjustable-rate programs (ARMs). The rate is tied to a specified market index. As the index fluctuates, your payments will too. People who choose this type of loan often are willing to take that risk to save money now. They may not be planning to stay in their home for a long time, typically less than five years. They may also be anticipating their cash flow to positively change later and would like the extra cash on hand for other purposes.
What are closing costs?
Closing costs are charges paid by the borrower in connection with the closing of the mortgage loan. Typically included in these costs are the origination fee, appraisal fee, title search, title insurance, recording fees, credit report fees, attorney fees, survey costs, and some prepaid items, such as taxes and insurance payments. Closing costs differ from program to program, but generally range from 1%-2% of the sale or refinance price.
What states does Westchester Mortgage lend in?
I am currently licensed by the Commonwealth of Massachusetts. My license number is: NMLS #13417 and Company NMLS#272780.
How can I obtain a copy of my credit report?
For a complete evaluation of your credit, you can use any one of the following recognized credit reporting agencies. Keep in mind that lenders require a current credit report, no older than 60-90 days. So even if you run one today, we may need to have another one done closer to the loan application date.
It seems like there are so many people willing to give me money. I receive letters and phone calls, and I see companies listed on the internet and in the newspaper. How do I choose which one to work with? Should I just be looking for the best rate?
The “best rate” is not always what it seems. Many lenders advertise an incredible rate, but the percent of borrowers who qualify for that rate is very small. Also, these rates often come with hidden costs, like high points or exorbitant closing fees. It is truly a buyer beware situation. As the saying goes, if it’s too good to be true, it probably is.
As for whether you should respond to any of these calls, letters, and TV commercials on your own, think of it like this: Sure, you could make three to five (or more!) calls, solicit the info, and make graphs and lists of rates that you might not completely understand or that come with hidden fees you’re not expecting. Or you could work with a licensed loan originator, like me, who’ll take the time to understand your goals, your situation, and get you to the finish line with the best program for your situation.
Remember, it’s my job to know the right questions to ask and to know the reputable lenders. I can help you sift through all of the options available and narrow them down to what best fits your needs. Best of all, I save you time.
If I’ve had some bad credit in the past, can Westchester Mortgage help me?
Sometimes people have complicated financial situations and have been turned down by their local bank as a result. I’m happy to review the documentation to determine what happened and to see what, if anything, can be done.
What are the reasons for refinancing?
People refinance to lower their monthly mortgage payments, to consolidate excessive credit card debt, to remodel areas of the house, or to help pay for school tuition.
When is the best time to refinance?
It all depends on your financial goals. I can run through scenarios to help you figure out the costs involved and if it would make sense to refinance. Also, since most of my clients are busy working and living their lives, I tend to take the initiative and alert people when it makes sense to consider refinancing. In other words, I never stop working for you, and I take pride in the fact that I continue to watch out for your best interests long after closing on the original loan.