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Richard Thomas
"Maryland Mortgage Professional"
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Richard Thomas answered:
Sandy,
I work for a correspondent lender and no it is not another name for sub-prime. There are no inherent risks in dealing with correspondent lenders. Basically what a correspondent lenders is, is a mortgage company that funds the loan initially then sells the loan to a "National lending company" i.e. Countrywide, Wells Fargo, Suntrust etc. The advantage of using a correspondent lender is (1) you generally get more personalized service then if you walked into a bank and (2) they will shop all of these National lenders to get you the most competitive rate. If you walked into your bank you would only get the rate they offer.
The lender you are working with already has the sale lined up with the National lender because during the loan process they have to adhere to that lenders specific guidlines in order to complete the transaction. So your lender may have already mentioned that your laon will be with "National Mortgage company A" which is normal but your closing docs will have the correspondent lender's name on it.
Good Luck with your transaction!
I work for a correspondent lender and no it is not another name for sub-prime. There are no inherent risks in dealing with correspondent lenders. Basically what a correspondent lenders is, is a mortgage company that funds the loan initially then sells the loan to a "National lending company" i.e. Countrywide, Wells Fargo, Suntrust etc. The advantage of using a correspondent lender is (1) you generally get more personalized service then if you walked into a bank and (2) they will shop all of these National lenders to get you the most competitive rate. If you walked into your bank you would only get the rate they offer.
The lender you are working with already has the sale lined up with the National lender because during the loan process they have to adhere to that lenders specific guidlines in order to complete the transaction. So your lender may have already mentioned that your laon will be with "National Mortgage company A" which is normal but your closing docs will have the correspondent lender's name on it.
Good Luck with your transaction!
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