Posted on: 03rd Apr, 2004 01:59 am
Mortgage broker refers to an individual or a company acting as an intermediary between borrowers and mortgage lenders. Brokers help in bringing the lender and borrower together for the mortgage transaction in exchange of a service fee. The object of engaging a mortgage broker is to avail loans at reasonably low rates of interest with little effort on one's part. One can thus find the mortgage program with the appropriate combination of features, options and rates as per his needs. The broker may also negotiate with lenders for the purpose of matching the requirements of the borrower with the terms and conditions set up by the lender.
A mortgage broker differs from a mortgage banker. A broker brings together both the borrower and the lender for the purpose of loan origination but does not actually originate or service the loan. On the other hand, a mortgage banker originates and services the loan.
The problem with most borrowers getting mortgage loans from lenders is that they are not aware of the information they should gather from the lenders. It is also true that most lenders offer only two or three programs thereby reducing the scope for getting the most suitable package at the maximum benefit. It is for this reason that borrowers approach brokers for help.
The broker acts as a common agent between the prospective borrower and the mortgage company/lending institution. He provides the borrower with professional guidance and advice on the various loan packages available. The broker deals with potential lenders and finds out the necessary solutions even in case of non-availability of any conventional bank mortgage.
It should be kept in mind that mortgage brokering is unlicensed in many states. Hence, there may be no licensing agency/authority to hear about your complaints in case of any problems. A broker may help you in selecting a loan program but there are some disadvantages of appointing brokers. There are several borrowers who prefer not to contact a broker but approach a lender directly thereby avoiding the broker's commission. Nowadays there are borrowers who make mortgage deals with online lenders as these lenders often come up with attractive rates and terms as compared to others in the industry. Therefore, it is up to the borrowers to decide whether they should approach a lender directly or via a broker.
Related Forum Discussion
A mortgage broker differs from a mortgage banker. A broker brings together both the borrower and the lender for the purpose of loan origination but does not actually originate or service the loan. On the other hand, a mortgage banker originates and services the loan.
The problem with most borrowers getting mortgage loans from lenders is that they are not aware of the information they should gather from the lenders. It is also true that most lenders offer only two or three programs thereby reducing the scope for getting the most suitable package at the maximum benefit. It is for this reason that borrowers approach brokers for help.
The broker acts as a common agent between the prospective borrower and the mortgage company/lending institution. He provides the borrower with professional guidance and advice on the various loan packages available. The broker deals with potential lenders and finds out the necessary solutions even in case of non-availability of any conventional bank mortgage.
It should be kept in mind that mortgage brokering is unlicensed in many states. Hence, there may be no licensing agency/authority to hear about your complaints in case of any problems. A broker may help you in selecting a loan program but there are some disadvantages of appointing brokers. There are several borrowers who prefer not to contact a broker but approach a lender directly thereby avoiding the broker's commission. Nowadays there are borrowers who make mortgage deals with online lenders as these lenders often come up with attractive rates and terms as compared to others in the industry. Therefore, it is up to the borrowers to decide whether they should approach a lender directly or via a broker.
Related Forum Discussion
Can a property owner in Florida secure a mortgage for that property in New York?
Yes, sure that can easily be done. There are many lenders who work on more than one state and many people try this kind of option as sometimes rates and points vary from one state to another.
Susan, you can go ahead for it, but get ready for lots of paperwork.
Thanks
[Edited by Jessica. Made minor changes. Thanks.]
Susan, you can go ahead for it, but get ready for lots of paperwork.
Thanks
[Edited by Jessica. Made minor changes. Thanks.]
Hi Susan,
Any Mortgage Broker can originate loans in a state other than where the property is located. But this can be done only if the Broker is licensed to originate the loan in the state where the property is located.
Thanks
Cliff
[Edited by Jessica, made minor changes. Thanks.]
Any Mortgage Broker can originate loans in a state other than where the property is located. But this can be done only if the Broker is licensed to originate the loan in the state where the property is located.
Thanks
Cliff
[Edited by Jessica, made minor changes. Thanks.]
Susan
While going with the broker, please check the licence as it should be a valid one and try to negotiate with him. Also, shop around as you will find many who offer this kind of service.
Thanks
[Edited by Jessica, made minor changes. Thanks.]
While going with the broker, please check the licence as it should be a valid one and try to negotiate with him. Also, shop around as you will find many who offer this kind of service.
Thanks
[Edited by Jessica, made minor changes. Thanks.]