What Is a Mortgage Broker?
A mortgage broker is an independent real estate financing professional who specializes in the origination of residential mortgage loans. Mortgage brokers normally pass the actual funding and servicing of loans to "wholesale lending services." A mortgage broker is also an independent contractor working with (on average) as many as 40 lenders at any one time. By combing professional expertise with direct access to hundreds of loan products, your broker provides the most efficient way to obtain financing tailored to your specific financial goals.
Banks and other sources of money establish relationships with mortgage brokers, knowing they will receive quality loan packages from them without having to open a retail brick and mortar location. They provide wholesale rates and costs to the mortgage brokers, who then pass on competitive retail rates.
Here are five things a lender does to provide a loan:
- Initiate
- Process
- Underwrite
- Fund
- Service
What Do Mortgage Brokers Do?
A mortgage broker does number one and two - initiate and process the loan package. They then submit the loan package to the best possible lender for the specifics of that borrower and property. The underwriter confirms all borrower and property guidelines are met, and funds the loan. They then may sell the loan to Fannie Mae or Freddie Mac to obtain funds to re-lend out again.
70% of the people in the United States use a mortgage broker.
The broker works for you, not the bank.
The rates and costs are competitive.
They have more loan programs from many sources to cover many properties and situations.
We talk to you and get it done.
In a volatile home-lending market, mortgage brokers can serve as "police," offering their clients security, safety, and peace of mind. One of the broker's most important functions is escorting your loan application through the entire process. They are constantly patrolling completed transactions for possible breakdowns. A professional mortgage broker can wade through the mountains of rate, data, and program options as well as research current market conditions to find the most accurate and up-to-date information about cost-effective loan options.
Brokers Handle the Details!
There are literally thousand of variables that can affect the outcome of your mortgage transaction. That's why you need a mortgage broker to act as a liaison agency with the underwriters, processors, attorneys, and any other services which may affect your transactions.
A mortgage broker also:
- Discusses and explains financing program options.
- Informs you (in writing) of lock-in options.
- Explains all documents of the loan application.
- Explains all associated costs of the loan application.
- Explains the disbursement of all loan proceeds.
- Explains the loan process from application to closing.
- Provides you with a good faith estimate of cost and fees.
- Communicates with you throughout the loan process in a timely manner.
- Coordinates the final closing of your transaction.
Brokers and loan officers are your resource for questions or concerns after your transaction closes.
