Everything you need to know before hiring a mortgage broker.
A mortgage lender (bank, credit union, or direct lender) funds the loan with its own money. A mortgage broker is an intermediary who works with multiple lenders to find you the best rate and terms. Brokers typically have access to wholesale rates unavailable directly to consumers.
Conventional loans typically require a minimum 620 score. FHA loans allow scores as low as 580 (with 3.5% down) or 500 (with 10% down). VA and USDA loans have no official minimum. Higher scores qualify for better rates — the difference between a 680 and 760 score can mean 0.5%–1% in rate.
Browse our directory and connect with a top-rated mortgage brokers professional.
Find a ContractorConventional loans: 3%–20% down (under 20% requires PMI). FHA: 3.5% down. VA loans: 0% down for eligible veterans. USDA loans: 0% down in eligible rural areas. A 20% down payment eliminates PMI and often gets the best rates but is not required.
Private Mortgage Insurance protects the lender if you default. It's required on conventional loans with less than 20% down, typically costing 0.5%–1.5% of the loan amount annually. You can avoid it with 20% down, a piggyback loan, or certain lender-paid PMI programs. FHA loans have their own mortgage insurance (MIP) regardless of down payment.
The interest rate is the cost of borrowing the principal. The APR (Annual Percentage Rate) includes the interest rate plus lender fees, expressed as a yearly rate. APR is useful for comparing total loan costs across different offers, but it's most accurate for loans held to full term.
Typically: 2 years of W-2s and tax returns, 2 months of bank statements, 30 days of pay stubs, photo ID, and information on all debts and assets. Self-employed borrowers typically need 2 years of business tax returns and a profit-and-loss statement.
Pre-qualification is an informal estimate based on self-reported information — it has little weight with sellers. Pre-approval involves verified documentation and a credit pull, resulting in a conditional commitment letter. In competitive markets, pre-approval is essential.
A fixed-rate mortgage offers payment certainty for the life of the loan — ideal if you plan to stay long-term. An adjustable-rate mortgage (ARM) offers a lower initial rate but adjusts after the fixed period. ARMs can make sense if you plan to sell or refinance within 5–7 years.
Underwriting is the lender's verification of all your financial information and the property appraisal. An underwriter approves, suspends (needs more info), or denies your loan. During underwriting, avoid major purchases, new credit accounts, or job changes — any of these can affect your approval.
The average purchase mortgage closes in 30–45 days from application. Refinances may take 30–60 days. Working with an organized broker who communicates clearly and responds quickly can significantly speed up the process.