A mortgage broker can save you time and money. They shop your loan among several lenders, handle paperwork, and often know which banks are friendly to self-employed buyers, first-time buyers, or people with a few dings on their credit. But a broker is not your friend. They are a salesperson with a financial incentive. That means you need to interview them before you hand over your tax returns, bank statements, and Social Security number. The right broker can open doors. The wrong one can push you into a loan that costs thousands more than it should.
Start with money. Ask exactly how they get paid. Some charge you an origination fee. Some get paid by the lender. Some get paid both ways. Ask whether they make more money if your interest rate is higher than the best rate you qualify for. A straight answer sounds like this: “I get paid a flat fee, and I will show you the lender credit or points on every option.“ A bad answer is vague or defensive. Ask for every fee in writing before you commit: application, credit report, appraisal, processing, underwriting, title, and any broker fee. Then compare that written number to what a bank or credit union quotes you.
Next, ask about access. How many lenders do they work with? Do they have relationships with big banks, small banks, credit unions, and online lenders? Can they show you more than one option side by side? If they only offer one lender, ask why. Sometimes one lender is the best fit. Often it means the broker gets a better payout there. A good broker will explain the trade-offs between a lower rate with higher closing costs and a slightly higher rate with a lender credit that covers your fees. They will also tell you when a bank has a better deal.
Check their license and history. Every mortgage broker should have a license number you can look up online. Check whether they are licensed in your state and whether there are complaints or enforcement actions. Ask how long they have been in business and how many loans they closed last year. Experience matters when your income is complicated, when you are buying with a partner, or when you need a quick closing. It also matters when a seller wants a fast timeline.
Ask how they communicate. Who will be your main contact? Will you get updates by phone, email, or text? How often? What happens if the loan is delayed or denied? A broker who disappears after you sign the application is a problem. A broker who promises a guaranteed approval before pulling your credit is also a problem. Nobody can promise a loan before the lender reviews your file.
Talk about rate locks. Ask how long the lock lasts, what it costs, and what happens if closing is delayed. Ask whether the lock can be extended and who pays for the extension. Ask about points. One point is one percent of the loan amount. Paying points can lower your rate, but it only makes sense if you plan to stay long enough to break even. The broker should run that math with you, not just say points are a good idea.
Watch for red flags. Pressure to sign today. Promises that sound too good. A request for a large upfront fee before you get a written Loan Estimate. Refusal to put fees or rates in writing. A broker who tells you not to talk to other lenders. You are allowed to shop. Get a Loan Estimate from the broker and from at least one bank or credit union. Compare the interest rate, monthly payment, closing costs, and total cash you need at closing. Ask the broker to explain any line you do not understand.
Finally, remember that a broker helps you get the loan, not manage it forever. Your loan may be sold, and your payments may be handled by a new company. Ask who will service the loan and how that could change. Then build your own paydown plan after closing. A broker can be a useful guide, but you are the one who has to live with the mortgage. Interview them like you would hire a contractor. Get clear answers in writing, and do not let anyone rush you.
