Good observation Frank! I think it comes down to what exactly it is you are looking for. It is true that there are good direct lenders and good brokers. When I stated that the direct lenders have more control over underwriting what I meant was they normally go through the same person all the time and if questions come up or conditions need to be met they know immediately. Brokers more or less take your information and fit you with the best lender...it just seems it would be easier to go directly to the direct lender. I can only speak from experience and although I have seen a few good brokers my most positive experience has always been with Direct Lenders. Through all of the bickering I hope your question was answered. Have a wonderful evening.

Jennifer Daywalt, Realtor
Re/Max Results Realty
Top Realtor 2004, 2005, 2006, 2007, 2008
Author of "Ask The Realtor" in The Phoenix Newspaper (Saturdays)
Phoenixville's Home Town Realtor
610-999-7693 - Direct
610-489-7355 Main
Sellinghomesjenn@aol.com

It took google.06 seconds to get the results, but your company still has a financial interest.

My domain includes 49 states. .

My time on Trulia is not wasted even if I spend a little time researching an answer, my profile has a pagerank of three, that means that if I have a link on my profile to my website some google juice is given to it. Every answer I give gives my profile more Google juice.

Ummm... ...Do we need to separate Dave and Melissa?
Because I see gloves comming off.

Also here is an exerpt from the Home Valuation Code of Conduct,
IV.
All members of the lender’s loan production staff, as well as any person (i) who is compensated on a commission basis upon the successful completion of a loan or (ii) who reports, ultimately, to any officer of the lender other than either the Chief Compliance Officer, General Counsel, or any officer who is not independent of the loan production staff and process, shall be forbidden from: (1) selecting, retaining, recommending, or influencing the selection of any appraiser for a particular appraisal assignment or for inclusion on a list or panel of appraisers approved to perform appraisals for the lender; (2) any communications with an appraiser, including ordering or managing an appraisal assignment; and (3) working together in the same organizational unit, or being directly supervised by the same manager, as any person who is involved in the selection, retention, recommendation of, or communication with any appraiser. If absolute lines of independence cannot be achieved as a result of the originator’s small size and limited staff, the lender must be able to clearly demonstrate that it has prudent safeguards to isolate its collateral evaluation process from influence or interference from its loan production process.

Well Melisa, Does your company have a financial interest in West Penn?

http://www.ripoffreport.com/reports/0/123/RipOff0123899.htm

nuff said

I agree with you Melissa. When I saw how much time it was taking my broker to get me a pre-approval letter from a direct lender, I started to worry about how long it would take to get an appraisal and close a loan. This may not have been true in the past, but in these times, I think the buyer's best strategy is to go with a reputable direct lender. In my case I chose Wells Fargo because they came out of the financial crisis smelling like a rose and I think a pre-approval letter from them will make my purchase offer look that much stronger.

As a professional that has worked on both sides of the spectrum, I believe brokers provide costlier loans that a bank would. As a broker, I was given many opportunites to charge additional overages and "back end" yield spreads. I didn't feel comfortable with the concept so I began employment with a large bank lender instead. I found that banks have many regulations that allow the borrower to receive service at a reasonable cost. There are limits to origination and discount point guidelines. Yield Spreads are prohibited. I am happier here because I know what I am offering is good wholesome service.

And what would you do if the bank went under while you had a loan in Melissa?

What if they get denied and have to go through the process three times?

I am a mortgage broker and I work for my client not the bank. that has more value than who the appraisal goes through.

mortgage brokers were no longer permitted to lock-in loan rates at the time of mortgage application and must rely upon their investors to do that for them, creating a time lag that could be critical in a rising rate environment.

Now it has been determined that a mortgage broker may not order appraisals directly, but must utilize the services of an appraisal management firm, creating yet another time lag, not to mention the uncertainty of not knowing who the appraiser may be. These added steps lengthen the process, but more importantly they remove control from those you thought would be guiding your transaction to a successful conclusion.

A Mortgage Banker, still retains the authority to lock your loans AS WELL AS ordering your appraisals DIRECTLY, without the use of any other outside management firm. Therefore allowing the process to remain streamlined and efficient, with fewer hands touching your transaction. You know what they say about too many cooks, RIGHT!

Misslivvy, Wells works with Mortgage Brokers, they even have a system in place to help them with marketing materials. We are setting up new lenders everyday, I am not taking a hit as a mortgage broker as a matter of fact business is increasing.

I think you have to take anything a Wells fargo rep says with a grain of salt. It certainly is in his best interest to diminish mortgage brokers since he is a direct lender/mortgage banker.

Here is an argument for using a direct lender you may not have considered:

I am a prospective buyer in an area where the vast majoriy of homes in my price range are banked- owned REOs. It turns out many of these banks will not consider your purchase offer unless it comes with a pre-approval letter from a DIRECT LENDER. In other words, they are no longer accepting pre-approval letters written by mortgage brokers.

Can a mortgage broker assist you in getting a letter from a direct lender? Yes, but in my case it was taking a long time because he was having trouble finding a bank that will do it for him in a timely manner. Banks are very busy right now. Meanwhile the property I am trying to buy has accumulated multiple offers, and my agent told me this afternoon it might be too late to get our offer in at this point. I hung up the phone and called Wells Fargo, and they told me to walk in and they would take care of it immediately for me.

The Wells Fargo rep also told me that brokers are taking a hit because of the credit crisis. Fewer and fewer banks are willing to work with them right now.

So I would say shop your own loan.

Good luck!

Ed, I agree with you on this statement "Ultimately, I think it is going to come down to the proficiency and experience of the individual loan officer and his/her team, and his/her ability to deliver on what they promise."
Really, nothing else is as imortant.

Jennifer, I would like to address a couple of points.

It is true that a mortgage broker has no control over underwriting, The loan officer at Wells also has no control over underwriting. The underwriter is in control of the banks money and works independent of the other divisions.

Fees, The mortgage Broker gets rates at wholesale and puts them out at retail, some brokers charge more than others and that is why you should pick a good broker.There would most likely not be any last minute changes if everyone gets pre-approved before they shop for a home and the buyer provides all requested information.

Is Wells as stable as you think they are? http://mandelman.ml-implode.com/2009/04/wells-fargos-surpris…
http://optionarmageddon.ml-implode.com/2009/04/13/wells-dodg…

Everyone can't get a loan at Wells Fargo or there can be adjustments that you might not know about, Examples(Pulled from the florida rate sheet):
Low Loan Size Adjuster
$0 - $49,999 FIXED/ARM 0.500
$50,000 - $99,999 FIXED/ARM 0.250

ADDITIONAL CONVENTIONAL CONFORMING ADJUSTERS

15 -year FRM w/ 120-month term FIXED 0.250
LTV > 90% 65%/CLTV>90=720 FIXED/ARM 0.250
All Other LTV>75% & FICO80% LTV w/no MI 1.000
Condo > 75% LTV ALL PRODUCTS W/ TERMS > 15 YRS 0.750

Adjusters for FIXED and ARM Products
2 unit 0.000
3-4 Unit 1.000
Secondary Financing 0.500
Non-escrowed 0.250
(except CA, IA, MN, NJ, NY, OR)



Now when these adjustments are factored in would Wells be the best choice? What if the loan doesn't fit neatly into Wells criteria? That is where the mortgage broker gets his value.

Hello Once Again Frank,

I can assist you with this question. I am not a mortgage lender or broker however I do a heavy sales volumn in Real Estate and deal with both on a regular basis. Direct Lenders are my favorite to work with. Their underwriting is done in house meaning I always have someone to contact and I am not put with different people all the time when I need a question answered. Also the fees for direct lenders, in all the situations I have seen, are LOWER. Wells Fargo, in which I have no affiliation, are the largest lender in the U.S. and they are not going anywhere. In fact they just acquired Wachovia! Their fees are very minimal and you will find that the interest rates are comparable to other direct lenders. This should help...Mortgage Brokers have to make their money somewhere, they either make it through a rise in the rate or through fees. Why pay more when you don't have to? Also I find that with the brokers, and this is not directed to anyone in particular, just a general statement, issues come up at the last minute, sometimes hours before a closing, that cannot be taken care of and closing is delayed. This is mostly due to the fact that the broker has no control over the underwriting of the loan. Hope this helps.

Jennifer Daywalt, Realtor
Re/Max Results Realty
Top Realtor 2004, 2005, 2006, 2007, 2008
610-999-7693 Direct
610-489-7355 Main Office
Sellinghomesjenn@aol.com

Many direct mortgage lenders (this can include independent mortgage bankers as well as banks, etc.) have muliple sources and programs as do mortgage brokers. My personal preference are direct lenders, and I work for an independent mortgage banker in PA. I like the control we have with underwriting and funding, as well as the stability. Mortgage brokers may feel differently about this because that same confidence can be expressed by them depending on their sources, i.e. who is approving and funding their loans. Ultimately, I think it is going to come down to the proficiency and experience of the individual loan officer and his/her team, and his/her ability to deliver on what they promise.

All right David you win,
I'll just turn in my answering permit and limit myself to watching.....

No thumbs up for you Dunes...not very funny

I can and Yes there is............................................................

My blog lists one reason to chose a broker over a lender: http://www.trulia.com/blog/david_chamberlain/2009/02/barclay…

There have been 24 closings of banks this year last I checked, if yours closes you will need to move your file to another lender quick, a broker is valuable in that situation. Is your lender going to shut down? You might find some information here: http://ml-implode.com/

If you are using a lender and you don't fit there criteria you have to go to another lender, if you are using a broker they can submit it to another lender

Frank, great question! While I'm an expert on real estate -- not mortgages -- I can tell you that I work with several PHENOMENAL mortgage representatives: 1 with Wells Fargo, 1 with First American Mortgage and 1 with Mortgage Mobility.

Each of them is EXCELLENT at what they do. Each offers different programs and works with different lenders. I would suggest that, when you're ready to contact mortgage representatives to get pre-qualified (which you SHOULD do prior to actually house-hunting) that you contact 2-3 of them and inquire about their programs, fees, etc. (They typically offer a FREE, no-obligation initial consultation so there's no downside to talking with different people offering different mortgage options.)

I would be happy to provide you with their contact info. Just shoot me an email at Judy.May@Century21.com or call me direct on my cell at (610) 324-5240 and I'll give you their contact information.

You've chosen a GREAT time to buy! If you haven't yet hired a buyer's agent to represent you, please be sure to interview Realtors and choose someone who you believe will look out for YOUR best interests and, of course, has the requisite experience and knowledge to properly guide you through the often-times complex process of homebuying.

Good luck to you!

Warmly,
Judy

Judy May, Esquire, REALTOR
"A Refreshingly Different Real Estate Experience" http://www.JudysFineHomes.com http://www.CollegevilleAreaHomes.com
judy@JudysFineHomes.com
C: 610.324.5240

CENTURY 21 Alliance
2828 Audubon Village Drive
Audubon PA 19403
O: 610.666.0202 x. 226

Finding the Best Mortgage Deal Takes Work

Home buyers who investigate mortgage options themselves as opposed to using a broker are likelier to get a better deal, according to a study for the Department of Housing and Urban Development published last year.

The study found that borrowers paid about $300 to $425 more in fees when they worked with a broker as opposed to working directly with a lender.

But comparison shopping can be tricky. Home buyers should try to devote a whole day to comparison shopping and include at least one credit union, a community bank, multiple national banks and an investment firms.

They should compare one type of loan at a time--for instance, a 30-year, fixed rate with no points. Their research should include a request for a guarantee that both the rate and the good-faith estimate will be exactly as initially presented. This standard could be difficult for a buyer to find, but it’s worth trying to find it, experts say.

Frank,
I work for a mortgage broker. The difference between using a direct lender and a Broker varies. With a direct lender you are limited to their programs whereas the Broker has a number of lender programs and is able to match your needs with the right loan program for you.
I hope this answers your question. Feel free to contact me with any other questions. the very best of luck to you!

Michael

Michael D Delp
Mortgage Pro
4802 Old Bethlehem Pike,
Telford Pa. 18969
Ph- 215-453-1025
Fax- 215-453-1012
Cell- 610-762-0318
michaelddelp@aol.com
michaelddelp@verizon.net
http://www.mortgagepro.instantlender.com

Some direct lenders will be able to charge less fees than mortgage brokers. What you will need to do is get a Good Faith Estimate (GFE) from any lender that you choose and then compare against each other. Interest rate isnt the only factor, some lenders will quote you a lower rate but they are charging you points or fees to justify that lower rate. It will come down which lender is able to offer you the lowest rate with the least amount of fees upfront. Sometimes it will make sense for you to pay points to lower the rate, it all depends on how much the point will lower the rate and therefore lower the monthly payment. I would be happy to discuss further if you would like.

Andrew Himes, CRS, e-PRO, ABR
Prudential Fox & Roach Collegeville

Oh, my there is a difference. ESPECIALLY in this market. While I think in NYC they work mostly with brokers, NYC is the exception to every rule in the world. It really should be on a different planet. As for everywhere else, use a direct lender. I did a blog posting on this very thing back in November - referenced below.

Great question!!! Best of luck to you.