A mortgage broker is an intermediary who works with multiple lenders and is paid a referral fee by the lenders. A bank mortgage officer represents only the products their institution offers. Mortgage brokers are regulated and require a license.
It is no surprise that the use of brokers is trending upward. Mortgage brokers work with many lenders: major banks, small lenders, private funds and insurance and trust companies. Because they work with so many lenders, mortgage brokers often have access to better rates. With all the changes that have happened recently with mortgage regulations and interest rates, it is not surprising that more people are seeking expert advice from a mortgage broker.
Although banks can supply a wider financial view and give information about many products, they might not have specialized mortgage knowledge. Some customers may find comfort in the idea they already have a relationship with the bank and its staff and the efficiencies of the approval process since the bank may already know a client’s account balances, credit card history, investments, etc.
Mortgage brokers offer a one-stop shop and are often able to get better rates than offered by major banks. Most of the time, mortgage brokers are able to arrange a mortgage for those having a hard time getting approved by the bank. Mortgage brokers are often mortgage specialist and are knowledgeable about what different lenders have to offer.