Many people are under the wrong impression when it comes to the word “broker”. The media has given many a negative impression when it’s not necessarily true. In most cases, as long as you’re dealing with a qualified, experienced mortgage broker/mortgage banker, you’re probably going to get a better deal than you can find on your own. The key is working with someone who has been around a long time, and whose reputation you know, or someone you trust has referred you to.
Here are some facts on the subject you really should know, to be an informed, educated borrower. I think you’ll find them interesting.
Keep in mind, when we talk about bankers here, we are talking about employees working at a bank, not mortgage bankers.
- Mortgage Brokers/Mortgage Bankers are required to be licensed to originate loans-bankers are not.
- Mortgage Brokers/Mortgage Bankers must attend continuing mandatory continuing education and ethics training-bankers do not.
- Mortgage Brokers/Mortgage Bankers fees are transparent and must be disclosed-banker’s fees do not
- Mortgage Brokers/Mortgage Bankers must pass a rigorous background investigation to ensure no past convictions or criminal activity-bankers do not
- Mortgage Broker’s / Mortgage Banker’s rates are based on wholesale pricing. Bank’s interest rates are based on retail pricing
- Most of the “Preferred” lenders that work with builders are not licensed, and fall within the loose requirements and standards of the bank loan officers who are not licensed.
You may be very surprised to find out that when talking to a bank about a loan, many times you are not even talking with a loan officer, but a clerk or a telemarketer type person. That is why you hear so many horror stories about people working on something for weeks or months with a major bank on deals that either don’t close, or don’t close on the terms the borrower was expecting.