What precautions should one take while dealing with brokers ?
First, you don’t have to pay any broker anything if your loan application has been turned down or you have not accepted the loan for any reason. You pay him only during the closure of the loan. The payment may vary between 1% to 10% of the loan amount, depending on your credit profile. Better the credit profile, lower is the payment to broker. Second, you must ensure that the broker is registered with the regulatory authority for mortgage brokers in your state. Third, the mortgage loan broker you are dealing with should provide you with the name and address of the lender to whom he/she has forwarded your loan package for evaluation within 14-21 days weeks after your complete application has been taken and the real estate appraisal has been performed. If the loan broker does not do this, it may be because he/she cannot find a lender for you (due to your credit profile or any other reason), or the loan amount you have applied for is more than the property’s worth, or the broker might not
