Go it Alone or Hire a Professional

The Internet is the most empowering tool we have ever had in history. Knowledge is power and the Internet is the ultimate source of knowledge. Within a few minutes, a person can find updated information on just about any topic. With this vast amount of information available at your fingertips why would anyone need to hire a professional?

It’s natural to conclude that with the help of the Internet, a person can arrange for mortgage financing without the cost of utilizing a mortgage broker. It must be cheaper to do something yourself that to hire someone to do it for you. What can an expert do for me that I can’t do myself with the power of the Internet at my disposal?

All the advertisements and promotions that we are exposed to all day long, encourage this way of thinking. Buy your car insurance on line it’s cheaper; It’s tax time, go on line and do it yourself, are but two examples. There is an endless list of services that have an on-line alternative to dealing with a professional. In many instances there is a cost saving, other times there’s not. When conducting business this way, you run the risk of not buying the right product or service. This is where the professional comes in; an individual who can help you interpret and understand the wealth of information you have assembled and offer advice to assist in the process.

Before the crisis in the mortgage market, the public was overwhelmed with the various mortgage products. The assortment ranged from the simplest, the fully amortized fixed rate mortgage, to the most complicated, the payment option ARM. Adding to the confusion, you then had various pricing structures that were dependant on the credit grade of the applicant and balancing the short term expense of points with the long term impact of interest rate. It was an unrealistic expectation for an applicant to become an expert using research alone.

In the current lending environment, things have gotten more complex. Lenders are taking losses on mortgage they wrote during the housing boom and new applicants are paying the price in two ways. Underwriting standards have gotten much more stringent and there is a desire to increase profits on every new mortgage closed. Adding to this complexity we are also dealing with a non-stop flow of revisions to underwriting standards.

Previously, when lending standards were liberal, or in some cases non-existent, getting approved for a mortgage was easy. It was only a question of deciding on the right product and for the best price. Today just getting approved is a challenge. Confirming that the pricing on the mortgage is proper for the credit profile that’s been presented is almost impossible for someone outside the business to do.

A person that decides to arrange for financing without involving a competent professional will first need to invest enough hours to become familiar with the current lending environment. He will need to become educated enough to separate fact from fiction. The Internet contains a tremendous amount of information to draw from, but there are no flags, rating the accuracy of what’s found. Only after the facts are identified and all aspects fully understood, can the application be submitted. He will then need to be able to address all concerns that the underwriter has, before a commitment is issued. He will be depending on his research to decide on the best mortgage product, the time to lock in a rate and the number of days the rate should be locked in for.

How many hours will all this take? What is the real cost of hiring a professional? Investing a few minutes doing this cost analysis will prove that hiring a professional is cheaper than investing the time to do it yourself. This isn’t even considering the experience and inside industry contacts the professional brings to the transaction.

In addressing your mortgage financing needs the best way to invest your time is in seeking out an experienced and ethical mortgage broker to work with. You will find that there is little or no additional cost in taking this route. The process will be smoother, less stressful and you will end up with financing that best fits your needs.

In the current lending environment it is the only way to be assured financing is available.