How is it that a couple who is paying $2,600 a month in rent could only qualify for a $280,000 loan?
They went to a bank first.
True story; after being told that they couldn’t qualify to buy the home they really wanted, they came to see me. After a thorough review of their tax returns I was able to get them approved for $450,000 and at the rate they needed. They were happily surprised.
The problem wasn’t that the bank employee was a bad person or incompetent, he just didn’t have the knowledge of analyzing and interpreting tax returns or the motivation to find the best rates. In fact, looking for the best rates isn’t a bank employee’s job at all.
Bank vs. Brokerage
When it comes to shopping around for the best rates and understanding all the FHA, VA, Fannie Mae, and Freddie Mac guidelines; I’m convinced that banks keep their employees in the dark on purpose.
Different banks play by different rules, some making the lending rules established by Fannie Mae, Freddie Mac, FHA, and VA tighter for their own benefit.
It’s the bank employee’s job to protect the interests of the bank, or at least follow the rules, unaware of what happens outside their walls. Their job is not to find the best loan for the buyer.
A mortgage broker has wholesale rates and needs to compete for the business of the consumer and for the realtor’s referrals. So it is in broker’s best interest, and the best interest of our clients and partners to find the best loan package.
It’s Not Always about Price
Although the lowest rate and fees are important factors when choosing a lender, it’s not the most important factor.
Having a broker who thoroughly understands the loan process (ever have a loan fall through Escrow?), who understands how to increase your credit score for better terms, and who is invested in finding you best rate for your property type and loan type, are all critical factors.
This type of knowledge is rare in the typical bank employee.
When shopping for a loan, why not go to a person who has access to all lenders instead of just one?
And don’t you think if the banker knew of a better deal and told you about it, that they would get fired?
So when you want options, the best price on a loan, and hands-on, one-to-one help with understanding your choices, go to a premier mortgage broker.
On a personal note, I’ve been in the mortgage business for more than 23 years, and I could work anywhere. But I would never work for a bank since it limits my ability to truly help people. Their rules, overriding of the GSE’s rules, and pricing, are limiting and prohibitive.
If you or someone you know is looking for someone who cares about their financial well-being then contact me today.