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Serving America since 2001
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E-Mail:
Info@MortgageMade4You.com®
Commercial; Most States. Residential;
Licensed by the Maine banking department, ME CSO-5742.
(c) Copyright
MortgageMade4You.com.
All Rights
Reserved 2001
Disclaimer: Properties shown on our site are not per definition financed
through MortgageMade4You.com®
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Why choose a
mortgage broker?
Two out of three Americans do. Brokers provide consumers
with:
Choice, Convenience, Expertise
The consumer receives an expert mentor through the complex
mortgage lending process. The broker offers the consumer
extensive choices and access to affordable home loans while
balancing the consumer's financial interests and goals.
Have more Americans been able to buy homes because of
mortgage brokers?
Yes! Mortgage brokers have pioneered the sub prime credit
market, using innovative loan packages to allow low-to
moderate-income borrowers, with less than perfect credit
histories, to start enjoying the benefits of home-ownership.
Many low income borrowers with less than perfect credit
histories would not have been able to purchase their dream
home without the assistance and dedication of a mortgage
broker.
Are mortgage brokers lenders or bankers?
Neither. A broker is a real estate financing professional
acting as an independent contractor. The range of products
and services offered through brokers, and by brokers, is
evolving rapidly. There are circumstances when brokers may
act as bankers, funding their loans. However, the majority
perform origination services up to the point of funding.
Does the mortgage broker really care about the quality of
the loan itself?
Yes, absolutely. The safety and soundness of the mortgage
lending community is directly linked to the success and
integrity of its home loan originations. Furthermore,
mortgage brokers represent the single largest residential
origination source today, emphasizing that they play a
significant role in the mortgage loan process. These numbers
highlight the fact that consumers who exercise their choice,
choose mortgage brokers; most likely because brokers are
dedicated to their customers: consumers, wholesale lenders,
and ultimately, American taxpayers.
Should brokers be regulated?
Brokers are regulated by several federal laws and
regulations and dozens of state laws and licensing boards.
NAMB supports reasonable and fair state and federal
regulation of mortgage brokers and lenders. The industry is
regulated by 17 federal laws and numerous state and federal
regulations.
What role does the broker pay versus the wholesale lender?
The wholesale lender underwrites and funds the home loan,
may service the loan payments, and ensure the loans'
compliance with underwriting guidelines. The broker, on the
other hand, originates the loan. A detailed application
process, financial and credit worthiness investigation, and
extensive disclosure requirements must be completed in order
for a wholesale lender to evaluate a consumer's home loan
request. The broker simplifies this process for the borrower
and the wholesale lender, by conducting this research,
counseling consumers on their loan package choices, and
enabling them to select the right loan for their home buying
needs.
The mortgage loan process can be arduous, costly, and
seemingly impossible to the consumer. The broker works as
the liaison between the borrower and the lender to create a
cost effective and efficient loan process.
Do brokers work for the wholesale lender or the consumer?
Neither. As an independent contractor, the broker allows
wholesaler lenders to cut origination costs by providing
such services as preparing the borrower's loan package, loan
application, funding process, and counseling the borrower.
Brokers help keep loan rates low due to their minimal
overhead and setup costs. Furthermore, the broker will seek
the loan which best suits the borrower's financial
circumstances, needs and goals. From the consumer
perspective, with rare exception, the broker does not get
paid unless and until the loan closes. Thus, the broker has
the ultimate incentive to provide the best possible customer
service to the consumer.
Isn't the broker supposed to get the best deal for the
consumer?
Since mortgage brokers offer the products of many wholesale
lenders they often can offer consumers a wider selection of
loan products. This question presumes that anyone can know
what is "the best deal." While many would consider "the best
deal" to mean "the lowest rate," a loan program with a very
low interest rate may not be the best choice for a consumer
with limited cash, if that rate comes with high points and
fees. A 15-year loan may save a borrower tens of thousands
of dollars in interest payments of a 30-year loan, but the
higher monthly payments may be acceptable to the consumer.
So, "the best deal" for any consumer depends on his
financial circumstances, needs and goals.
Today over two-thirds the nation's mortgages are originated
by mortgage brokers. This clearly indicates that consumers
are choosing the superior options, service, and expertise
offered by mortgage brokers. Brokers have forced retail
lenders to compete with other loan sources driving down
costs nationwide.
Don't brokers "steer" consumers to the wholesale lender who
pays the highest fees to the broker?
While isolated instances of adverse steering can occur, the
mortgage brokerage industry has predominantly armed
consumers with a free-market economy weapon: open and
vigorous competition. Any consumer exercising his or her
basic right to shop and compare, will ultimately find the
loan options that are in his best interests. The combination
of government-mandated disclosures and vigorous competition
has presented today's consumer with unprecedented levels of
choice. While price is an important consideration in
advocating a specific wholesale lender, brokers also make
their professional recommendations based on a number of
other factors which include the lender's:
reputation for service
underwriting criteria
ability to fund a loan on time
compliance with consumer's requirements
Why do brokers collect fees from both the consumer and the
lender? Isn't this a conflict of interest or a duplication
of charges prohibited by RESPA?
RESPA allows fees to be charged between settlement service
providers, as long as those fees are reasonable for
services, goods, or facilities actually provided. Mortgage
brokers provide the same services to consumers as do retail
loan offices that typically charge the consumer an
origination fee. These services include: taking the
application, obtaining the credit report and appraisal,
counseling the consumer on the loan process, and collecting
the necessary documents. Brokers also provide separate and
distinct services and facilities to wholesale lenders. These
include marketing the lender's products and assembling and
delivering the completed loan package.
In addition, lenders may pay brokers a premium -- "yield
spread premium" or "service release premium" -- which may
include compensation for the services and facilities, but
also represents payment for the intrinsic market value of
the closed loan. All of these are legal compensation. It is
important to remember that regardless of which party
compensates the broker (lender or consumer), in almost all
cases the broker receives nothing until the loan closes.
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