Due to the high rate of mortgage defaults and declining home
prices, many banks have tightened their mortgage lending practice
and have made it quite difficult to obtain a mortgage. Those who
are looking for a mortgage, and are having a difficult time
securing a home loan, should consider working with a mortgage
banker to get their mortgage. Working with a mortgage banker has
many advantages compared to getting a mortgage through a
traditional lender.
The first reason to work with a mortgage banker when getting a
mortgage loan is that a mortgage banker can often provide a
borrower with lower interest rates and fees than traditional banks
can offer. Mortgage bankers often work for institutions that only
offer mortgages to their customers, as opposed to traditional banks
that also provide deposit accounts and other loans. Because of
this, mortgage bankers do not have the same overhead expenses and
traditional banks and do not need to charge as high of an interest
rate as traditional banks to turn a profit.
The second reason to work with a mortgage banker that the
mortgage bankers tend to have looser underwriting standards than
traditional lenders. Traditional mortgage lenders and banks are
suspect to the tighter federally guided underwriting standards.
Since mortgage bankers are not, they are often able to provide
mortgages to customers that would not normally qualify under the
traditional lender's guidelines. However, the mortgage bankers tend
to charge higher interest rates and fees as compensation for taking
on the additional risk of lending to the otherwise high-risk
borrowers.
The third reason to work with a mortgage banker is that mortgage
bankers are often able to provide different mortgage products than
traditional lenders. While mortgage regulations have cut down on
the types of mortgages that traditional lenders can offer, mortgage
bankers have not been as affected. Mortgage bankers can still offer
some unusual mortgage products including interest only mortgages,
adjustable rate mortgages, and negative amortization loans which
may not be offered by traditional banks.
Related Q&A：
Reasons to Work with a Mortgage Banker？Oh boy, there are quite a few reasons! First off, a mortgage banker has in-depth knowledge and expertise. They know all the ins and outs of the mortgage process. They can guide you through the confusing paperwork and explain everything clearly. Also, they have access to a wide range of lenders and can find the best deal that suits your specific needs. And you know what? They can negotiate better terms and rates on your behalf. It's like having a pro in your corner fighting for you. So, working with a mortgage banker can really save you time, stress, and money.
