I have been listening to some laughable adverstisements by a local broker as to why you should work with a mortgage only company. "that you wouldn't go there to buy a cd so why go to a bank to get a loan"

It makes me chuckle everytime I hear it except for the small glimmer of concern I have for people who may actually to believe that to be true. I am going to walk through the failure of that reasoning and give a couple of other fairly powerful reasons to consider working with a bank.

1. The "mortgage only companies" well what they mean by that is that they are mortgage origination only companies. 9 out of 10 mortgage only companies are either brokers meaning they act as a missleman and never lend any money, or they are correspondent lenders menaing they lend the money and immediately transfer the servicing. So in esscence they are your buddies for a month and then you never interact with them again. What happens to the loan well typically it ends up being serviced by you guessed it a bank. So the irony is by this companies own logc of course you would only go to a bank for your mortgage, because they are the only ones ultimately lending the money for your loan and the ones you pay everymonth. So I guess if I was as low level in my reasoning I would run an add telling you to only go to a mortgage only company if you wanted to buy something from someone who doesn't actually own it.

2. Since a bank does actually service the loan and underwrite the loan they are really the only ones who actually control the money. A broker sends the loan to a lender who underwrites it. A correspondent lender still typically underwrites to the bank they sell it to's standards. Even a bank still conforms to Fannie Mae Freddie mac and FHA underwriting standards, but typically we have some concessions etc that can save you time and money and add a little flexibility to the underwriting process.

3. Banks can offer you a true debt management solution. Since your "mortgage only"  companies can't do personal loans, credit cards, or offer savings product you will never talk to a representative from that company who can cut 5% of the rate you are paying on a card or 7% off your personal loan or even a percentage point off your car loan. Now of course we cant always deliver that savings it all depends on the rate market, but wouldn't you like someone to ask and take a comprehensive approach to managing your debt?

4. Almost all of the banks have caps on what can be charged to a borrower basically they puposely limit their own profitability because not only do they want to do your mortgage they want you to think well enough of them to purchase other products as well. No broker that I have ever heard of caps their profitability on a loan to anything other than what the bank they are selling it to caps it at. By being a smart shopper you will never run into this, but if tracking the rate markets isn't your thing or if you are a first time buyer and know what you don't know well why take the chance?

5. Because we want all your business whether it is savings products or other debt products ( as mentioned above) we often provide discounts that these one channel companies can't/ For example Fifth Third offers a cost discount on all of our first mortgage products if you pay via a direct withdrawal from a Fifth third account. Our home equity products typically receive a .25% rate reduction for the same thing.