Updated: March 26, 2014 at 6:49 PM

How your mortgage broker cheats you

Category: How To Mortgage Broker/lender

By knowing how your mortgage broker makes money, you will know whether they are trying to trick for their own self-interest or whether they have your self-interest.

Your mortgage broker makes money by commission. 
1. Mortgage broker makes higher commission of they can get you to borrow more. To encourage you to borrow more, the would ask you to buy a bigger house because housing prices will always go up. Truth is, bigger house means bigger expenses offsetting the value of the house.

2. Mortgage broker makes higher commission if they can get you to go Fixed rate rather than variable rate. A mortgage broker make higher commission if they can get you to pay a higher interest rate. To do that, they could tell you that they believe the rate will go up. My advise to you is variable rates has always been the better choice. Fixed rate is a scam.

3. Mortgage broker makes higher commission if they can get you to commit for longer periods. IF you do end up going fix, you have the option of going one year, two three year, four year or five years. Five year, fixed rate is the highest interest rate and is the biggest of all scams. If you mortgage broker tell you to chose that option, go with a different more honest broker.

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