A real estate purchase is probably one of the most expensive transactions you will complete during your lifetime. Mortgage loans are typically used to help spread the cost of a home out over many years. This makes the property more affordable.
Since you could be saddled with your mortgage loan for up to 30 years, it's important that you get the best loan available. Loan rates and terms can vary based on market conditions. You will need the help of an expert to obtain the most favorable loan. Mortgage brokers and mortgage bankers are two such experts.
Learn more about the unique services each type of expert provides so that you don't confuse the two when hunting for your next home.
A mortgage banker is a loan professional that works for a single financial institution. You can typically find these experts in the loan departments of any major bank or credit union. Mortgage bankers specialize in helping buyers obtain a loan through the bank that employs them.
If the bank offers competitive rates and favorable terms, then working with a mortgage banker can be beneficial. If the bank's mortgage products are not the most competitive, you could end up spending more when you partner with a mortgage banker.
A mortgage broker differs from a mortgage banker in some significant ways. The most important is that a mortgage broker is not limited to working with a single financial institution. This gives a mortgage broker the freedom to evaluate your unique financial situation, then find the lender offering a loan that will meet your specific needs.
A lot of buyers find that they are able to obtain more favorable financing when working with a mortgage broker. Since a broker receives no benefit from the financial institution issuing the mortgage loan, their sole focus on providing borrowers with access to quality and affordable mortgage products.
Determining if you should work with a mortgage banker or a mortgage broker can be challenging. If you want the freedom to explore all of your options without having to forge individual relationships with a lot of different financial institutions, then hiring a mortgage broker is your best option.
A broker can help you identify aspects of your unique circumstances that might impede the loan process, then discover financing that will overcome your limitations and allow you to invest in the home of your dreams.