I just read an article that a friend sent me about mortgage brokers that was published in the NY Times Real Estate section last week. It is titled "Banks Bypassing Mortgage Brokers" .
In summary, the article is about how banks are blocking brokers from offering their loans and only allowing retail transactions. We all know that lenders are imploding daily and there are fewer places for brokers to take loans, which is not as beneficial for the customer.
I have heard several cohorts wonder aloud if mortgage brokers will be around in a year or two given all of the regulations that are being implemented. I personally think that brokers are being over-regulated and that it is not fair that banks do not have the same regulations as brokers. I also am of the mentality that it is a few rotten brokers and loan officers that have caused most of the problems and passed bad loans to borrowers. As the article states, "mortgage brokers say they have been unfairly blamed for the industry's failures in recent years. They point out that it is the lenders, not brokers, who ultimately approve a borrower's application."
I believe that brokers have the ability to "shop" for the borrower and get them the best product and rate out there and are not limited as banks are. I do see a continued need for brokers and think (hope) that this is just a cycle that we are going through. As a contract mortgage processor, my livelihood is tied to the success of my brokers. I think that there need to be some changes and things need to be shaken up a bit which is currently happening. My hope is that, once things settle down a bit, the program guidelines and some regulations will be relaxed within reason. I am all for keeping people honest, but I think a few of the new regulations go a bit too far and don't really benefit the borrower.
I'd love to get opinions from the ActiveRain community. Do you think mortgage brokers will be around in a few years? Why or why not?