QUESTIONS TO ASK A MORTGAGE BROKER TO AVOID GETTING SCAMMED
May I have a copy of your State Banking License?

If you are working with a mortgage broker, make sure they are licensed with the State Banking Department. The license number allows you to file a complaint if you have a bad experience. Also, State Banking laws require the mortgage company to follow strict privacy and security policies to prevent identity theft. You can see if any previous complaints have been filed against a licensed mortgage company by visiting www.azbanking.gov.

Do you have a referral-based business?

This separates most fly-by-night rip-off artists from the others who are trying run an ethical and customer service oriented business. If someone has a referral program, they will be more likely to care about your long term satisfaction.

On average, how much does it cost to refinance or finance a new home?

If they are reluctant to give the information, ask “how much would you charge me?” and have them provide a Good Faith Estimate. The closing costs for an average refinance or home purchase should be between 1 - 2% of the loan amount. This price includes all loan orignation, broker fees, processing fees, title fees and other pre-paid finance charges. Some brokers charge much more and others may charge a little less but it is usually based on the value they deliver to their clients.

How and when will you communicate with me during the loan process?

12% of purchase closings are either delayed or cancelled due to issues that arise in the lending process. This means that a lot of new home dreams are going up in smoke every day. One of the biggest issues during the rush to close a loan is disclosure and communication. If you are buying a new home or refinancing, there are up to five parties involved: You, the loan officer, the buying and selling real estate agents and the title company all working as a team to make sure your transaction is completed on time. Make sure the loan officer has an upfront strategy for communicating and is willing to give you all of his or her contact information. You want an officer that will tell when there is a problem just as quickly as when everything is OK. Playing phone tag is always an issue, so we invested in a web tool that allows clients 24 hour access to the status of their loan. Ask your loan officer if they use a web-based customer service tool that will provide 24/7 loan status reports, it will help your loan fund on time and let you sleep easier during the process. The last question and probably the most important financial question is,

May I have a truth in lending disclosure statement and good faith estimate based on the loan program you would recommend?

These documents, along with your loan status report, which used to be called a prequalification letter, will give you all the information you need to make an educated decision about the loan program the lender is offering.