Mortgage brokers
I was a real estate agent when the mortgage brokerage business exploded onto the scene. Mortgage brokers were able to obtain loans for my clients at a lower cost than traditional banks and savings and loans where most people went for mortgage loans in those days. How were they able to do that?
A mortgage broker worked with wholesale lenders and investors. By having lower overhead, and willing to take a lower margin of profit, the broker often extended lower rates and fees to the client.
They were also able to obtain loans for clients that were rejected by banks and S & Ls. The broker can shop different lenders to find one that would fit the client’s qualifications. All the client had to do was fill out one application instead of going from bank to bank, filling out numerous applications to see which one would approve their loan.
Now mortgage brokers are commonplace. Banks are trying to get back some of the loan business by advertising more programs than they used have in the past. But brokers continue to offer many benefits to the client. However, you do have to be careful who you work with. As with any business, there are unscrupulous brokers out there who will take advantage of you and you may end up worst than going to your bank for a loan.