Hometrust Mortgage
Phone: 417-877-4777
Email: jbaskins@hometrust.com

>> Broker vs. Banker

This is an important distinction.  Before you choose, you need to determine your comfort level for risk and expertise. 

BIRDDOGS: Brokers are just loan agents --- "birddogs" retrieving clients for distant lenders.  They make no loan approval decisions, which often leads to many negatives for you (see Credit Tips).  Many brokers charge non-refundable fees, so they make money even when you don't get your loan.  Many local banks are now mortgage brokers, as they prefer the lower overhead and staff, while avoiding any risk from decision-making.

DISTANT APPROVAL: To lower risk and expense, some bankers still ship files to outside decision-makers for loan approval - increasing closing time and often causing errors from their lack of local knowledge of our market.  Even worse, this out-sourcing spreads your identity information to countless others. 

DECISION-MAKERS:  Mortgage bankers literally fund your loan with their own money.  Since they remain responsible for complete, legal and timely documentation, their level of competence and experience is generally higher.  But be aware of a major difference here, too:

LOCAL APPROVAL: True mortgage bankers are true lenders - Originating, Processing, Loan Approval all done locally.  This maximizes your protection, minimizes closing time, and avoids "distance errors".  You can talk directly to the decision-maker.

SOLUTION:  Choose wisely. 

• Only share your family financial information with those you know and trust. 
• Make certain to check if others will broker or bank you loan. 
• If you choose a broker, understand they must share your information with many others as they cannot make local decisions. 
• If they say they are a bank, check if they locally process and/or underwrite, to insure you know where your information is going. 
• If you are promised rates and/or low fees, insist on them in writing within one business day (this helps separate out undesirables). 
• Compare rates and fees, and be skeptical of lowball estimates.  Insist on value overall.
• Bottom Line is to get the best for your family, so consider more than just rates and closing costs.  Consider how your lender takes care of his most valuable asset - you.