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Mortgage Broker or Bank Loan Officer--What's the Difference?

By
Mortgage and Lending with WealthWise Mortgage Planning, a Division of American Pacific Mortgage Corporation NMLS #1850 NMLS 244226

Roseville mortgage

Mortgage Broker or Bank Loan Officer--What's the Difference?

When you are home shopping in Roseville, California, you can get bombarded by mortgage people wanting to handle the financing for you. 

If you visit a new home subdivision, you may hear that you have to use their approved loan person.  That's not true nor is it ethical. 

Put an offer in on a foreclosed property and you might be told you have to get pre-qualified with a certain lender, then get pressured to use that same lender if your offer is accepted.

After you submit a loan application to one lender, you may get phone calls from others trying to get you to work with them.

So, what is the truth?  You can use whatever lender you choose.  That's the law.  If someone on the seller's side balks about your financing, find another home to buy!

You have two main options for help with financing--a mortgage broker or a bank loan officer. The main differences between the two center on professional background and product offerings.  (There can be unscrupulous ones in either option!)

  • A mortgage broker is required to have an active California real estate license that is in good standing with the State.  In addition, they must meet requirements for continuing education.  And, beginning in  2011, every mortgage broker must pass a national and state proficiency test for a Mortgage Loan Originator Endorsement to their license.  Continuing education is required to renew this Endorsement annually.  Brokers have access to multiple lenders, each with multiple financing options.
  • Bank loan officers are not required to have a license, complete continuing education or pass tests.  They offer only the loan products available through their bank.

Don't be fooled into thinking have to use a certain loan resource.  You have choices and now you know what they are!

Related Post:

Assembling Your Home Buying Team -- Knowing The Players

What Does It REALLY Cost to Get a Roseville Mortgage

Comments(5)

Gerry Michaels
Glasswork Media Arts - Gettysburg, PA
GettysburgGerry Social Meida

Nice work Ed, I am sure there are many first time home buyers that could use this info. there are so many questions and it is so hard to have all the answers.

Jul 17, 2010 01:58 PM
Gina Chirico
Lattimer Realty - Fairfield, NJ
Real Estate Agent - Essex County, New Jersey

Ed,

Thanks for the clarification.  It does get  confusing sometimes.  With that being said, I still prefer that a buyer have an approval from either my in-house (even if he doesn't want to use them at least I know if my in-house gives the green light, the buyers solid) or at the very least, a reputable bank.  Joe Shmoe on the corner doesn't quite make the green light....lol!

As far as foreclosures, I know most banks require buyer get pre-approved through them but can get funding elsewhere.  Has that been your experience? 

Jul 17, 2010 02:03 PM
Ed Gillespie
WealthWise Mortgage Planning, a Division of American Pacific Mortgage Corporation NMLS #1850 - Folsom, CA

Thanks, Gerry!  I appreciate your feedback

Gina--some mortgage brokers are definitely more solid than others.  My company is one of the largest in the U S and now has a banking operation so I can broker or go direct.  Be able to offer the latter has been a big benefit for me.  As to foreclosures, yes, that seems to be the model.  However, it is also very commonplace for the pre-approving lender to try any number of underhanded tactics to steal my client.

 

Jul 19, 2010 05:34 AM
Anonymous
Karen Mountain

Ed- Well put!  I think the more the public realizes that we, as mortgage brokers, are held to a higher standard, and can also offer more options, the better.  And of course, we both work for the best brokerage!! Good job!

Jul 30, 2010 07:22 PM
#4
Ed Gillespie
WealthWise Mortgage Planning, a Division of American Pacific Mortgage Corporation NMLS #1850 - Folsom, CA

Thanks, Karen!  I agree completely!  Glad to know you like FPF as much as I do!

Jul 31, 2010 07:31 AM