When it is time to negotiate your home mortgage loan, two kinds of people have opposite need: the borrower (you) and the bank… As you want to pay as less interest as possible, banks wants to make profit lending you a home mortgage loan.
The mortgage broker plays a special role in this relationship. He is just between you and the bank to negotiate the terms conditions of the loan. Thus, it is logical to ask yourself if the broker works for the interest of the bank or for your interest…
The first interesting point to mention is that the broker’s allowance is paid by the bank. This may lead us to think the broker works for banks. Not necessarily.
What role your Bank and Broker play in relation to your Home Mortgage Loan?
The universe of mortgage loans is very competitive and largest banks trade billions of dollars every year. This competition helps to consider banks as partners and suppliers to you (broker’s customers).
Banks usually offer to brokers an allowance to pay for his work. But borrowers are the real customers of brokers. Why? Because the aim of the broker is to find the best mortgage strategy and the best product for the needs of their customers.
Since mortgage brokers are paid with allowances, they must correctly work for their customers in order to keep a good reputation. Even if brokers, as for banks and borrowers, work for themselves first, you can find an honest one who helps you to find the best deal!
That’s all for this article. If you have any comments or experience to share, please write it right away! You will help a lot of people to get good information and avoid mistakes!
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The mortgage broker is responsible to the client, finding him the best deal available. The broker is also responsible to the lender to ensure all documents are accurate, complete, and meet lender requirements. A broker who doesn’t look out for his clients’ best interest won’t stay in business long. Get the information you need to ensure you are getting the best deal possible from my book, “Getting To Closing”.