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Differences Between A Direct Lender And A Mortgage Broker
etting that perfect the cost.
mortgage for your new home
is always made better when This makes it so that both of
you know that you got a good deal them are operating on the same
on it. It is always comforting to principle - more sales equals
find out that you are still happy more money. Other than that, both
with it even some time later. The of them will draw from various
way to find that perfect deal, mortgage products and both will
though, could begin with try to fit the client with the
something as simple as making a best mortgage product that they
choice between a direct lender or have at their disposal.
a mortgage broker. Here are some
thoughts to show you why one may The Differences
be better than the other.
Now, for some of the differences.
Before any of the differences are Here is where you will find a
looked at, there are some things much larger field, and it is one
that are common to both. The that will bring about a large
first thing, though this might difference.
surprise some, is that both are
usually paid on a commission •The Products Available
basis. While it is often pointed
out that mortgage brokers only A loan officer is simply the
get their money from the actual front man for an organization -
sales of mortgages, the same is the bank. He or she is the one
true of loan officers at a bank. that you will deal with when
In other words, both have the seeking a mortgage. Since they
exact same motive for helping you are essentially an employee of
- they want to make a living, the bank or other lending
and, they both get a portion of institution, they will can only
receive money when they sell that different, but generally, you
particular company's mortgage will find that a direct lender
products. To put it plainly, they will be much more business-like
can only show you the products in his or her demeanor. It will
they are given - from one be more of an official visit.
company. Although there may be a
rather large number of products, A mortgage broker, on the other
they are limited as to what the hand, will usually be much more
company offers. friendly, relaxed, and personable
with you. They honestly value
A mortgage broker, on the other your business and they will
hand, would have at his or her usually let you know it. It would
disposal, an extremely wide not be unusual if a broker even
selection of products because visited you in your home to go
they regularly deal with many over some details or talk with
companies. In fact, a mortgage you some more. They often give
broker can represent a couple of you more time to talk
hundred different companies, and person-to-person than a lender
therefore would be able to offer will, and they will be very glad
many hundreds of different to take the necessary time to
mortgage options - possibly even make sure you understand all the
thousands of options. details.
•Level Of Commitment Apart from this, a direct lender
may not be as committed to you as
Another difference between a a mortgage broker. A loan officer
direct lender and a mortgage knows that people will come to
broker is the matter of his or the bank looking for loans simply
her personal interaction with because it is a bank. They can
you. Now every person is get by with doing little and
there may not be a lot of be suitable for those who have
incentive on the part of the loan less than good credit. The
officer to go an extra mile for interest rate of a standard
you. The reputation of the loan lender for this type of situation
officer is not the same thing as would make the interest rate too
the reputation of the bank. With high for most - if a loan could
a mortgage broker, however, his be extended at all.
or her reputation is the
business. They want your business A mortgage broker, though,
and will often work hard to find regularly deals with people in
a mortgage product that is suited this situation and quickly knows
to your needs. They know that a which lending agency to call on
satisfied client will speak for that could provide a mortgage at
their business in years to come - a better rate for someone with a
especially if you know a lot of lower credit score.
people.
•Better Deal
•Greater Options
A direct lender is more likely to
In most cases a direct lender, give you a deal without being
especially one that has been in able to provide much of a leeway
the business a while, will often when it comes to interest rates
stay away from certain loan or extra fees. The lending agency
products. This will tend to make itself would set these fees and
their products better for people the interest rate based on
with good credit and a strong certain parameters and the loan
ability to repay the mortgage. officer usually is not able to
This makes the loan officer vary much from it - except
extremely limited because most of upwards.
their products (if any) may not
Once again, though, because the remortgaging or getting a second
mortgage broker is dealing with mortgage. It also may be better
many companies, and each lender because many lenders will give
he deals with knows it, they will you a discount if you have more
provide (in many cases) a greater than one loan with that bank.
flexibility for him to vary
several factors - thus often Another possible advantage is
resulting in a slightly better that a broker may contact a
deal. lender in other parts of the
Advantages Of A Direct Lender country. This could tend to slow
down the mortgage process if they
While there are certainly a are not familiar with the various
number of advantages that do make reasons of why a house in your
the mortgage broker appear to be area may cost more, and be worth
the better way to go, there are more in your area than in
also some things to consider that another. They would have to take
may point the other way. One the time to search out the matter
thing that could make the bank satisfactorily, which could delay
officer a possible better way to your mortgage - and possibly set
go would be if you already have a back the closing date. A local
mortgage with that bank. It is lending institution would already
possible that, since they already know the values of buildings in
have your paperwork in this case, that region and would not have
that you may be able to save on a difficulty with it.
lot of the expense of either
About the Author:
SNC Loans provides commercial loans to clients nationwide. They do not offer home loans but provide useful information in the mortgage industry to all who are interested.
Read more articles by: Eric Morgan
Article Source: www.iSnare.com |
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