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Using the Services of a Mortgage Broker Checklist

Before you commit yourself-and your finances-to a mortgage broker, ask yourself the following important questions:

  1. Have I checked with the Division 1-800-223-8791 or (317) 232-6681 as to the mortgage broker's status as licensed, exempt or unknown?

  2. Have I pulled my credit reports and score so I am prepared for borrowing a realistic amount of mortgage money and know whether or not I qualify for a sub prime loan?

  3. Have I tried using lenders other than a mortgage broker to locate a loan, such as the credit union at work or a bank?

  4. Have I made copies of any documents that I have provided to the mortgage broker, so that if I decide to go elsewhere, I will not have a hostage-documents problem?

  5. Do I have the completed and signed mortgage broker service contract stating the amount I propose to borrow and the broker's fee if the loan closes?

  6. Did I receive a completed good-faith estimate of closing costs that also addresses the yield spread premium issue?

  7. Have I been provided with a copy of my application by the mortgage broker, plus other documents, as I sign them?

  8. Have I been told 2 to 3 weeks after my completed application who the proposed lender is, their business address with telephone number, how the loan will be funded, and when I am getting a written loan commitment letter from the lender?

  9. Do I know if the loan will contain a pre-payment penalty, balloon payment, escrow account for taxes if I want one, where the closing will take place, and how to contact the title company conducting the closing?

  10. Have I been provided with a draft copy of the HUD-1 settlement statement one business day prior to the closing so that I may compare the fees with the good-faith estimate of closing costs?

  11. At the closing, do the terms and fees match what I was promised? Am I prepared to get up and leave if I find discrepancies?

  12. Am I going to get complete copies of the mortgage, the promissory note, and all the other documents at the closing?

  13. Does this lender service their own mortgages, or will the servicing—the collection of the mortgage payment each month—be sold? If the servicing is sold right after closing, do I know the telephone number, business address and name of the mortgage servicing company—provided to me in writing?