Mortgage broker vs. Mortgage bank: Whom should you choose as your mortgage broker? One would be better than another according to your specific circumstances. Those with a good credit score, for example, may make a slightly different decision than an applicant with only a bad credit score. The key, though, really is to receive quotes from both types of sources and then compare notes. You may be surprised by how much difference there is in terms of what the mortgage lender can offer you.

Mortgage Broker

A mortgage broker, on the other hand, specializes in finding the lowest mortgage rates for a home loan. For example, if you are applying for a home equity loan (which is a revolving line of credit similar to a credit card) the Mortgage Broker  Calgary Alberta can find you the lowest possible rates. They do this through the Multiple Listing Service (MLS). This allows brokers to find the most competitive rates for your situation. Banks generally don’t make this kind of information available to their customers.

When dealing with mortgage banks, the process is pretty much the same. You go to one of the many banks and tell them what kind of mortgage you want and why you need it. You will also have to provide them with information about your income and assets. You will most likely receive various offers from different banks before finding a lender that will match your unique needs.

Different Loans And Mortgages

The primary difference between mortgage banks and brokers comes from the fact that brokers typically work for a wholesale lender rather than a retail bank. While a retail bank can offer you a variety of different loans and mortgages at competitive interest rates, a wholesale lender will usually have a single loan application it will send your way. This application will be sent out to several different lenders for consideration.

Bad Credit

If you have bad credit or want a more unique mortgage to refinance, you may need to use mortgage brokers to find the best rates. If you do not use a broker, it is virtually impossible to find anything but the highest interest rate that a bank can offer. Retail banks rarely offer special deals for people with bad credit. This is because their interest rates are usually fixed at wholesale or are tied to their prime rate. Because brokers are paid a commission on mortgage refinance loans, they are often willing to search hard for the best deals for their clients.

While working directly with a financial institution may be your preferred option there are other options. There are online mortgage brokers that will allow you to fill out your loan application and submit it online to the lender you are looking for. You then have the option to choose from one of their loan officers who will contact you to select an individual from their website to talk to over the phone. Working with a mortgage broker does not necessarily mean working with an online loan officer; it is still better to use one than working directly with the financial institution you are shopping for a loan from.