In the past 2 years we've bought and sold a house, bought a townhouse, and are now in the process of buying another house!
When going for our mortgages we use a broker, we don't go directly to any one bank. The broker sends our application out to "X" amount of banks and then comes to us with each banks terms/rate and we decide with his help whats best for us. We do not pay him. When you go for a mortgage and they give you the print out of fees there is always a couple thousand dollar fee for the bank to pocket. With a broker the mortgage company pays him. We only pay the application fee which is about $50-$100, but that now gets waived for us!
As to what it looks like on your credit, yes you don't want 30 different bank inquiries on your credit because it will bring your score down. A few won't and the banks know and expect you to shop around for the best rate. A good way to go about it is getting your credit report on your own. You can get them online at any of the 3 creditors like transunion. It doesn't hurt your scores. Then when shopping tell them your credit score and they may be able to give you a close guesstament on what rate/bank you can get. Remember when banks check your credit they are using an average of your 3 reports, not just one. Remember whatever bank you use, they usually pull your credit one more time right before closing. So if it dropped drastically, you might get stuck with a higher rate. So do shop around, but try to keep it to having your credit pulled by 5 or less banks.
Hope this helps!
Oh one more thing. You mentioned not being happy with the approval amount. That usually doesn't change much by changing the lender. You either have the income for the amount they approve or you don't. What does make a difference is if you're putting a large % down. Let's just say for example you were approved for a $200,000 loan. You find a house you want and it is $235,000. If you are putting down 20%($47,000)you will be fine, and you won't pay PMI because you put 20% down. If the scenerio were different and you were only putting 10%($23,500)you probably won't get approved, and remember, if you put less than 20% down you pay PMI and you need to work that figure into your monthly payment.
Best bet is having a large down payment. Believe me, I know that's not easy!!
Let me know if this makes sense and if you have other questions.
