Mortgage Broker vs Mortgage Banker
Jun 27th, 2008 by shop-universal-best-buy
Mortgage Broker vs. Mortgage Banker
There is a common misconception that a mortgage company is a bank that lends their own money as the mortgage value. In reality, these types companies that lend you money are either a mortgage banker or a mortgage broker. In a broader sense both these terms simply mean somebody who confers the loan. However, there is a huge difference between the two terms.
The difference:
The mortgage bankers are the agencies that provide direct loans to you. Their working process includes advertising for themselves, processing the various applications, negotiating with the prospectus customers and finally granting the authorized funds. Nowadays, these types of bankers have increased in number, and more and more bankers are functioning with never-ending schemes and offers. In fact, the terms and condition of the loan as well as the rate of interest vary from one baker to other. However, these bankers often sell the loan to the secondary market.
The mortgage brokers are actually middlemen, who handle all the details of your mortgage loan for you. They also select the best and most suitable banker on your behalf. Since they are experienced professionals, they know every minute detail of each banker functioning in the market. Their working procedure includes the loan shopping and then they analyses the requirement of the different borrowers. Depending on this analysis, they put the lenders and borrowers together as well as get the best available deal for you. Most of these lenders from whom your broker gets loans do not even deal directly with public. As a whole, the job of a mortgage broker is to give you an idea about the right path, while saving your time and money.
Pros and cons of a mortgage banker:
• By taking a loan from the mortgage banker you can save the fees of middleman and can also make the loan process pretty easier.
• Mortgage bankers give first hand information about the loan as well as provide direct approval of your loan.
• They provide very competitive rate of interest and offer a fixed or in some cases adjustable rate mortgage option and the terms of the loan is set by the guidelines of the bank. If you fail to fit these guidelines your application will be eventually denied.
Pros and cons of a mortgage broker:
• Mortgage brokers have access to large variety of loan programs and also have contact with several bankers. Thereby they can easily find a loan that fits both your needs and financial picture.
• They help to save your time on research.
• Due to their knowledge and skills they can get you the best interest rate and repayment plans available.
• They can avoid unnecessary fees to save your money.
• However, they charges high amount of fees for each and every services.
No matter from whom you are taking the loan, it is always suggested not to lie or even mislead your lender and always try to provide the valid documents.
Mortgage Broker vs. Mortgage Banker / Author: komal sinha
