Articles
3 Types of Mortgage Brokers and How to know which is Best for You
There are three types of mortgage brokers. By understanding what each one of these mortgage brokers do you can find the best broker to handle your new mortgage. There are other ways to obtain mortgages as well, but for now we are just looking at mortgage brokers and mortgage types.

A pure mortgage broker deals in all the mortgage types. They act as a sole broker rather than crossing the lines in other types of lending. They are a third party in the mortgage industry. The mortgage types they can offer at the moment are going to be based on what the lender has to offer. The lender will accept the mortgage broker application that you submitted and work directly with the broker. With a pure mortgage broker you can expect the broker to have fees on top of the lending company. The lending company is normally a bank offering certain mortgage types based on the current market.



The next type of mortgage broker is the correspondent broker. This type of mortgage broker offers a third party option as well in the mortgage types. In other words they work with banks or other entities to lend you money. The Correspondent mortgage broker is normally designated as the lender on the closing contract for the mortgage types. Then the broker will transfer the loan to or on behalf of the lender who actually advanced the funds. This is the difference between the pure mortgage brokers. The pure mortgage brokers have the money to lend in their hands; normally they work for the bank by preparing the applications and loan agreements. The pure brokers can keep the loan within their company rather than selling or transferring it to the actual lender.

Lending mortgage brokers are the last type of mortgage brokers. Again these brokers work with all the mortgage types. The mortgage types vary from adjustable rate, fixed rate, interest only, principle and interest, commercial and much more. To get any of the mortgage types through a lending mortgage broker you will be offered a line of credit or other funding without obligation to sell. In other words, the correspondent transfers the loan to the actual lender.

The pure lender works within a bank for the actual lender. The lending mortgage brokers don t have to sell the investment they just signed on. In fact they get the risk of the interest rate fluctuations and origination fees.

Now that you know the types of mortgage brokers you can look at the one you might want to have help you. They all deal in the same mortgage types so that is not a concern. The concern is whether your mortgage will be sold to a different company after you take it out. You also need to be concerned with the size of the mortgage broker. The lending mortgage brokers are smaller businesses than the pure broker. The pure broker has a bank behind the loan as does the correspondent. These two are better than an individual company in which you could have your mortgage sold for an increase in price to you.