Why Use a UFMB?
The process of shopping for a mortgage loan is different when you utilize an Upfront Mortgage Broker (UFMB). Instead of shopping for a mortgage loan, you are shopping for a mortgage broker. Once hired, the NMLS licensed Upfront Mortgage Broker will perform the shopping for the mortgage loan on your behalf.
You should go about the hiring of a UFMB as you would any other professional service provider, such as an architect or a lawyer. Specifically, you should ask what is the fee for the services? What services are you receiving for your fee? What are the broker’s qualifications? A UFMB is required to provide you with the amount of the fee in writing.
The UFMB‘s fee could be a fixed dollar amount, a percentage of the loan amount, or a combination of both as allowed by law. Once the fee is set, it cannot change. Further, the UFMB does not collect a fee for service until the loan closes, and only if the loan closes.
At a minimum, the services that a UFMB provides will be same basic services you would expect to receive from a mortgage broker who is not an Upfront Mortgage Broker. However, because the Upfront Mortgage Broker’s fee is established in advance, you can be assured that the information and counsel you receive from an Upfront Mortgage Broker is objective and un-biased. Additionally, the UFMB will give you any excess lender rebate for the locked rate to help you with your closing costs.
When you interview a UFMB, you can certainly ask for information on current mortgage interest rates, but you should not base any decisions on what you hear. The interest rate quote you get from an Upfront Mortgage Broker may not be the best, because it will be an honest quote. Honest brokers cannot compete with mortgage brokers who ensnare consumers by quoting prices they cannot actually deliver.
Once you have hired a UFMB to assist you with your financing needs, the UFMB is required to operate under the terms of the Upfront Mortgage Broker Commitment.