Pros and Cons: A Phoenix Mortgage Broker Versus a Bank Or Lender?
The first thing one has to do while buying any real estate is to get a suitable
mortgage program for the financing of the project. One can avail finance
directly from banks, financial institutions or go through brokers. Now comes
the question of which is better: approaching banks directly or working through
brokers.
A mortgage banker is basically the person who will be making the loan directly.
He will present to you the mortgage particulars of the bank he represents upon
which one discusses about payment schedules.
A mortgage broker is a person who chooses the best banker or lender who fits
the home buyer’s financial needs and time commitments.
THE BANK IS CHEAPER
When it comes to mortgages, one will find that a bank is cheaper. This is due
to the fact that banks process the loans directly. One just has to approach the
bank, discuss points and have the loan processed at the actual rates. In the
case of brokers, they charge a commission, resulting in an increase in the
actual closing fees of the loan. Brokers have a right in charging as much as
they please for loan processing or “doc prep” – document processing.
Working through the bank gives faster results; this is due to the fact that the
banker not only originates the loan, they also do the underwriting of the loan,
prepare the closing documents and dispense the funds. They have full control
over the processing of the loan. Whereas in the case of brokers, they present
the loan to a bank for processing and wait till the bank informs them of the
completion of the loan. So the bank is not only cheaper, it is also faster.
PHOENIX MORTGAGE BROKERS PRESENT A CHOICE FOR MAKING A MORTGAGE
When one approaches a bank, one gets only the mortgage program of that
particular bank. Whereas approaching a broker presents one with not only one,
buy hundreds of programs from various banks and financial institutions. One
doesn’t have to face the hassle of approaching various banks to get the
programs of the various banks. The broker provides all these particulars and
saves the buyer’s time in searching.
Brokers are sort of a matchmaker between the lender and the home buyer. They
usually know specific lender’s specialties. So they can choose the best lender
that would fit a buyer’s individual needs.
As one can see, approaching a bank or lender is cheaper and faster in terms of
the processing of the loan; whereas approaching the broker presents one with a
huge choice of mortgage programs. It is up to the buyer to decide if paying the
broker’s fees is worth the time saved in searching for the right lender, or to
go directly to the bank.
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