Buying a home is a complicated, time exhausting, and multi-factor process. The average price of a new home is $330,600. One thing that most new homeowners don’t fully appreciate is that paying for the home is just one of the multiple expenses that must be paid throughout the home sale process. Depending on where you live, the amount of home sale Closing Costs you must pay could be considerable. So, unless you understand how home sales must be legally conducted in your state, you may want to employ a Mortgage Broker. But what is a typical mortgage brokers salary?

This is pertinent information to know for homeowners. Depending on what you don’t know, and what you need your mortgage broker to do, your mortgage broker can make a lot of money.

And, as long as that works out for you, that is not necessarily a bad thing.

Mortgage Brokers Salary

The average mortgage broker could make like 1% to a 2% commission commensurate to the overall loan amount they secure on your behalf.

Or you could pay the mortgage broker a basic flat fee for their services. This fee is called a borrower-paid compensation.

Also, due to the passage of the 2010 Dodds-Frank Act, a mortgage brokers salary cannot be self-manipulated in their favor.

For example, a mortgage broker can be paid by a financial lender or a homeowner, but not both.

A mortgage broker can’t charge hidden fees to a homeowner or financial lender either. Every service offered by a mortgage broker must be plainly revealed and itemized.

So, if a mortgage broker helps you to secure a $330,600 loan, their 2% commission would amount to $6,612.

How exactly does a mortgage broker earn their mortgage brokers salary?

What Does a Mortgage Broker Do?

Mortgage brokers are bureaucrats who can easier expedite the facilitation between homeowners and financial lenders.

A mortgage broker can accomplish this facilitation in a variety of ways.

For example, a good mortgage broker is usually very good at gathering and facilitating paperwork to finalize a loan on your behalf.

On average, it can take as long as 56 days to finalize a home sale.

During that time, a mortgage broker must verify your employment and income status, get a copy of your credit history, and other documents.

The mortgage broker will then use this information to compare various mortgage lenders’ offers for your benefit. A good mortgage broker will already have a good network of lenders with which they are familiar.

Mortgage lenders will then search for the appropriate mortgage lender and loan interest rates that will match your needs as a homeowner. A good mortgage lender will take care of all underwriting and contract writing responsibilities too.

Once you and the financial negotiate final terms, through the mortgage broker, the mortgage broker will then facilitate all of the final paperwork.

It is during the final phases of home sale paperwork, or the closing costs phase, that you need a good mortgage lender.

Closing Costs

Closing costs are a long list of final costs, fees, and payments that must be paid to finalize the home sale.

For example, there may be various federal, state, city, and local taxes and fees that may apply to your home sale transaction. The number of closing costs that you pay ultimately depends on where you live.

When a home sale is finalized, a property title is being transferred from the previous homeowner to the buyer. A lot of real estate-centric laws and tax obligations must be considered in the resulting paperwork.

A mortgage broker’s salary is really earned if they can figure out how to reduce the number of closing costs you need to pay.

Typically, you will pay anywhere between 2% to 5% for closing costs relative to your mortgage loan amount. So, if you apply for a $330,600 mortgage loan and your closing costs are 5%, then you will pay $16,530 in closing costs.

Keep in mind, closing costs are a set of extra costs that you pay in addition to the mortgage brokers salary of 1% to 2%.

Here are some typical closing costs:

• Origination fee
• Appraisal fee
• Home inspection fee
• Property tax
• Surveyor fee
• Title search
• Attorney fee
• Credit report fee

Always remember that these are just a few examples of the kinds of closing costs you may pay.

Mortgage Brokers Salary – Are They Worth It?

Unless you understand the intricacies of real estate law and the homebuying market very well, it may benefit you to get a mortgage broker.

The best way for you to find a mortgage broker for your own need is to get a referral.

Or make a list of local, licensed mortgage brokers and look up their professional reputations online.

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