Analytical Report
Analysis of Different
Types of Mortgage
Lenders
Purpose of Report

My first time buying a house

Didn’t know anything about the process

Is it important to shop around for a
mortgage?
Comparing Mortgage Bankers
to Mortgage Brokers
Definition of Mortgage Banker


Is a direct lender
Works alone in deciding to loan you
money or not
Definition of Mortgage Broker


Represents several different lenders
Works to match you with the lender
that best meets your needs and
offers you the best price
How to decide which to use?
Compare and contrast the
different characteristics, benefits,
and risks of each option
Reliability
Mortgage Bank


May have a well-established
reputation within the
community
Subject to state and federal
licensing and regulations
Mortgage broker



May not be as well known or
well established
Not all states require brokers
to be regulated
Can check Better Business
Bureau or Association of
Mortgage Brokers
Convenience
Mortgage Bank




Will only get one loan offer
To comparison shop, you will
need to got to another bank
and start application process
again
This can be time consuming
Time actually processing loan
may be quicker as you are
dealing directly with lender
Mortgage Broker



Is familiar with several
regional and national lenders
Submits your application to
many lenders at once
Many online lenders: Lending
Tree, Ditech.com
Qualifying
Mortgage Bank


May or may not grant loan
If not, you must start the
process again at a different
bank
Mortgage Broker

Is familiar with many different
lenders and may be able to
direct you towards lenders
who are more apt to grant
your loan
Savings
Mortgage Bank



May save money by dealing
directly with a lender
No hidden fees
Possibility of getting better
rates based on standing with
bank, i.e., doing other
business with bank, accounts
in good standing
Mortgage Broker


Usually charge some type of
fee for the service they are
providing you
May be able to get lower
interest rates because of all
the lenders they have access
to
Summary



There are many benefits as well as risks to both
bankers and brokers.
Depends on what is most important to you.
Are you willing to risk doing business with a little
known company to get the best rate, or is it
worth more to feel the security of working with
a more established company if it means a little
higher rate?
Conclusion


Based on my research, I feel the right way
for me to go would be a mortgage broker.
“Bankers make their salary whether you
take the loan or not. Brokers only get
paid when the loan closes. Who has the
most motivation to get you a loan?”