What are Brokers Fees When Purchasing a New Home?

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What Are Broker Fees When Purchasing a Home?

• Dunhill Homes

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The Broker Process
The mortgage broker process works like this  a
mortgage broker will shop a multitude of lenders
to ensure his or her client receives the best
possible home loan.  Because brokers typically
shop dozens of lenders, it is not uncommon for
them to locate a loan with a better rate than
ones bank may have offered.  If a broker secures
a loan with the lowest possible interest ratean
interest rate that may not have been secured,
otherwisea homeowner can save tens of thousands
of dollars over the life of the loan.
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Paying Broker Fees
Many times, a broker gets paid a commission
either from the lender who accepts the brokers
client or the broker gets paid by means of a
markup on the loan.  At times, a broker might
employ a sliding fee-scale since some clients
with impaired credit histories will require more
of the brokers time and effort with finding an
appropriate loan or getting approved for a loan. 
Also, the more complicated a loan might be broker
fees will increase, accordingly, since
complicated loans can take more time to
close. Bottom line, the fees a broker charges are
either paid by the borrower or the lender or
both and that fee is typically between 1 and 2
of the loan amount.  There are cases, however,
where the broker is not allowed to be paid by
both borrower and lender.  If you are the one
paying 100 of the broker fee, you may be allowed
two options for payment  1) have the broker fees
embedded into the loan or 2) pay the money
up-front as one lump sum.
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Conclusion
Many people who are in the market to buy a new
home simply do not have the time to contact
multiple lenders and compare rates and analyze a
myriad of details while searching for a
mortgage.  A Mortgage Broker does all the
leg-work and will do what it takes to find the
best rate and mortgage terms to tailor-fit your
needs!
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