Knowing Is a Mortgage Broker or Mortgage Banker Is Best
The housing bubble market crisis that happened over a decade ago changed the rules and regulation around mortgage loans. Back in the day mortgage brokers had complete control over the loan origination market. The mortgage loan industry only got a bad reputation because the brokers participated in dodgy dealings.
The SAFE Mortgage Licensing Act of 2008 tightened the restriction on the broker industry, so there is a lot of protection for the borrowers than before. Borrowers will have to take higher loans when the broker takes premiums but that was stopped since they need to pass the licensing exams. You have to understand the benefits of taking a mortgage loan from a bank or a broker and research to know which one is good for you.
A mortgage broker is usually a middleman who works with the client and the bank so the shop around for the best mortgage loan. Mortgage brokers work with a variety of multiple lenders to help with negotiations and collaborate closely with your realtor. It will be easy for the mortgage broker to shop for the best loans once they get information from your paperwork like income statements and credit reports.
Many of the brokers ask for 1 to 2.5% commission after you receive the loan but that will depend on the type of loan you take, and the commission can be paid by the borrower or lender. You have to find the best mortgage broker in your area by looking through their credentials and ensure they have good ratings from their past clients. A mortgage banker works in a financial institution to provide mortgage loans after vetting the borrower to see if they are ideal candidates.
The mortgage banker works directly for the bank and give the final say when it comes to approving the loan. Salaries bonuses and incentives are given to mortgage banker since they are part of the staff of the institution regardless of the loans they close. Brokers are capable of getting a variety of mortgage loans for the borrower which is a great benefit for someone who wants to get a good deal on a tight budget.
When the borrower has any credit problems, their loan application will be rejected immediately, but the broker knows which lending institutions are less strict on the loan qualifications. If you want to get a mortgage loan in a short time then you should hire mortgage bankers and can sign the documents needed to go to the next step.