I AM A MORTGAGE BROKER, HOW CAN I HELP YOU?
Maybe you've wondered what is the difference between a mortgage banker and a mortgage broker. Below is a repost from Joe Petrowsky of an article by Addison Hartmann which breaks this down.
“I am a Mortgage Broker, how can I help you?”
They say timing is everything, so let me share the experience I had this morning, that's relevant to the article below.
I received a call from Frank, kind of a gruff sort of guy. The conversation started out kind of simple and easy. He told me that his attorney had referred him. I asked him what his attorney said about me and he went on to say some nice things, but I could tell that he had a chip on his shoulder.
Frank went on to tell me that he has been at 3 different banks, but all of them turned down the loan. I allowed him the rant for a while, finally getting him to stop and start telling me, what he was attempting to do. He wanted to refinance his existing mortgage that had 15 years left.
In the middle of the conversation he said, why should I do a mortgage with a mortgage broker instead of a bank. I asked him, if the bank was going to get his mortgage done, he finally said NO.
Now that I was back in control of the conversation, he allowed me to run his credit, which was excellent, however he had a lot of credit card debt, which had his debt ratio off the chart. I told him, that a refinance was possible, as long as we could include his credit card debt into the mortgage.
He came to the office later in the day, bring me all the paperwork that he had been giving the banks for the last 4 months.
Originally he didn’t want to refinance any credit card debt into a new mortgage, but he realized it was best for him. The new mortgage was $187,000 @4% for 20 years. His new payment was $1,411. As part of the refinance, we paid off $56,500 in credit card debt. Between his old mortgage and the credit card payments, he was paying $2,675 . His debt ratio ended up being low enough to easily do his mortgage. What do you think, did he make the right decision?
He was blown away by the savings. He called his brother from my conference room and handed me the phone after telling him, "I want you to talk to my mortgage broker about your refinance."
I am a mortgage broker located in Manchester, Connecticut. I am licensed to originate loans in Connecticut, Massachusetts, New York, Rhode Island, Maine, Vermont, New Hampshire and Florida. How can I help you?
Why to use a Mortgage Broker
A Mortgage Broker is an independent loan originator that helps you, the consumer, find a loan that fits your needs. They work with many different lenders; therefore, have a VERY wide variety of programs to fit almost any situation.
Consider the following reasons why bypassing a mortgage broker and going directly to a bank can be limiting:
- Banks are product oriented. They have only their programs to offer and, if you don't fit or don't like them, they'll send you away having wasted your valuable time. Very few individuals fit the bank's required "perfect loan scenario".
- Banks tend to focus solely on the A-credit borrowers and require low loan to value ratios. (Loan To Value is the percentage you intend to borrow in relation to the value of the collateral)
- Banks don't see enough of the credit challenged borrower to be able to offer the advice and information you need to put yourself back on track to be a more solid loan applicant.
- Mortgage brokers have access to almost every loan program in the marketplace, providing a one-stop shop.
- Mortgage brokerage firms only get paid if your loan closes, giving them incentive to get the job done.
- Mortgage brokers can act as a filter, helping to determine how to present your loan package in the most favorable way.
- Good mortgage brokers are accustomed to comparing and contrasting many different loan programs - finding the best one for your situation, regardless of the lender.
- Good mortgage brokers are willing to work with you months in advance to help prepare you and/or your loan.
- Good mortgage brokers may identify other loan programs for your situation, such as a refinance to help your cash position.
- Many mortgage brokers are dependent upon referral business, making them more concerned with your happiness.
MORTGAGE BROKER VS LOAN OFFICER
When you're looking to get a mortgage loan, you may work with a loan officer or you may choose to work with a mortgage broker. People often confuse the two job types even though both will glean the same results: a new home. However, it is important to understand the difference between the two types of jobs so you know what to expect from them during the mortgage application process.
A mortgage broker is an individual or firm that acts as an independent agent for both the borrower and the lender of a mortgage loan.
Mortgage brokers are the middle man between you and the lending institution, which can be a bank, trust company, credit union, mortgage corporation, finance company or even an individual private investor. A mortgage broker will analyze your financial situation to determine which lender is the best fit for your loan needs. He or she will submit your mortgage application to one or more lenders in order to sell it, and works with the chosen lender until the loan closes. He or she receives a commission from the borrower if the loan closes.
A loan officer is a representative of a lending institution, such as a bank, who works to sell and process mortgages and other loans originated by their employer. They often have a wide variety of loans types to draw from, but all originate from that specific lender.
Also known as a loan representative or account executive, loan officers represent the borrower to the lending institution and will guide him or her through the selection, processing and closing of mortgage loan. Loan officers can be paid a commission or salary for their services.
Joe Petrowsky, NMLS #6869
Right Trac Financial Group, Inc. NMLS #2709
110 Main St.
Manchester, Ct. 06042
Office: 860 647-7701 x16
Fax: 860 647-8940
Cell: 860 836-9294
Email: joe@righttracfg.com
Joe Petrowsky does not guarantee nor is in any way responsible for the accuracy of the information provided herein, and provides said information without warranties of any kind, either expressed or implied.
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