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WTF is a Mortgage Broker?
It’s all in the name, a mortgage broker is a person, or company that finds people who want a mortgage to buy or refinance a home and pairs them with a suitable lender.
The mortgage broker will see your home loan through the entire process — from the initial application to the closing of the loan. Then the lender will take over to collect your payments. Mortgage brokers are often local, informed and a part of your community.
Why be a mortgage broker? Why not just work for the bank?
One reason to be a mortgage broker is to be more aligned with the consumer.
Consumers who want a home loan have 3 options — a bank or credit union, a non-bank lender, or a mortgage broker. All three offer mortgages with different guidelines, restrictions and interest rates.
Banks will often come in and out of the market depending on their appetite for the mortgage business. As their market share continues to decline, it appears they are not interested in the mortgage business these days.
Banks will restrict their mortgage business by tightening up their lending guidelines or by increasing their rates. Rather than getting rid a specific program — say jumbo adjustable rate mortgages — banks will simply increase the rate they offer an adjustable rate mortgage to the consumer so it will be too high…
