Do you really need a Mortgage Broker?

I'm quickly learning that this blog can be useful to answer so many "FAQs" in advance . Now, if only I could get my clients to read this before the questions were asked.



Last week I discussed selling on one's own as opposed to using a Real Estate broker. Similarly, questions arise regarding applying to a bank for a mortgage directly as opposed to using the services of a well known and well recommended registered Mortgage Broker.



While it is true that often the Mortgage Broker will place the loan with a high profile lender such as Citibank, Chase, Washington Mutual Wells Fargo or HSBC which lenders maintain offices capable of taking direct mortgage applications, there are tremendous benefits in approaching those same lenders through the Mortgage Broker.



First of all, the Mortgage Broker, unlike an employee of a Bank has an array of products and a further array of lenders so that the borrower and the specifics of the loan can be matched to the appropriate lender and mortgage product. The variety of choices can be staggering and a good Mortgage Broker can make the best match for a particular situation. Some of the common variables involve the differences between coops & condos, new or resales, 80% 85% or even 90% financing, credit score issues, co-signers, owner-occupancy issues etc.

Bank employees, even the best of them do not seem to be as "motivated" as Mortgage Brokers. Simply put, it is financially beneficial to the Mortgage Broker to satisfy the client who, it would be expected, could refer new clients down the road.

Having said all that, perhaps the most compelling reason to use a mortgage broker can be best explained by an experience...actually two.
Twice, in the last six weeks, I received the "dreaded" phone call the day before a closing that "unfortunately" the bank will not be able to close the loan tomorrow. Tomorrow!!! Clients are ready to close, moving trucks are loaded, everyone is ready....except the bank, with no acceptable reason, will not be able to close the mortgage.

Thankfully, both of these loans involved a Registered Mortgage Broker, Norman Calvo of Universal Mortgage

The moment I was informed of the problem, I notified Norman Calvo. In each instance, he stopped what he was doing and dedicated the entire balance of his day to "arm-twisting" at the banks (one was Chase, the other Citi) until the files were re-cleared and re-scheduled for closing as originally planned. Yes, they both closed!

Interestingly, the second of the loan problems was a relatively small mortgage but the effort expended by Norman would make one guess it involved a million dollar loan.

I will always believe that both of these closings would have been adjourned at great inconvenience were it not for the efforts of Norman.