While one bank might have only a couple of loan programs available to the consumer, a mortgage banker is a licensed professional who offers a wider variety of rates and mortgage terms for you by accessing a network of lenders that includes major banks, credit unions and finance companies. Furthermore, a mortgage banker is not beholden to any certain bank or lender, hence, there are no special interests involved to use specific companies. In essence, a mortgage banker “shops” loans for you.

Also, loan rates can rise quickly. Many people try to “shop” for loans with various banks and lenders, but because rates can change daily or even hourly, you would have to be getting a current quote simultaneously from every lender you’re shopping with. (And unless you lock your loan with that lender immediately, the price of the loan could change at any moment.) A licensed mortgage banker will be an advocate in many areas, including watching the market for you, to ensure that your loan is locked at the right time, so that your rate does not rise during the loan process.

A “quote” means nothing unless you have completed a full loan application and the lender has underwritten and approved your file. The interest rate is only part of the price of a loan. Hidden fees and other costs can significantly raise the cost of your loan even when the quoted rate seems low. There are also various types of loans to choose from – each with advantages and disadvantages. An experienced mortgage banker shops loans for you and will be able to point out the pros and cons of rates and points in a loan, to serve your highest needs. The goal of a dedicated, professional mortgage banker is to save you as much money as possible on interest and fees.

A mortgage banker has access to a large pool of wholesale banks and lenders. This means that a mortgage banker is able to provide favorable rates and terms for customers with excellent credit, while also being able to find financing for customers with less than perfect credit.

There is no such thing as a “no fee” loan. Loan officers, Mortgage Bankers and banks always charge a fee for arranging a loan. If someone offers you a “no fee loan”, it means the fee is hidden somewhere under a different category. This tactic can be very misleading to consumers. An experienced mortgage consultant will explain costs openly to you (not try to hide them) and will always help you find the best way to structure your loan based on your unique financial situation.

While some “loan officers” at banks are sometimes knowledgeable, they are paid to sell you one of the limited number of loan programs offered at that particular bank. Unfortunately, the bank “loan officer” tends to fill more of a secretary role and does not have direct contact with the underwriters who actually process and approve the loan. As a result, you run a higher risk of “loan fallout” at the last minute. That can mean losing your home due to financing problems at the last minute. Finally, bank “loan officers” are not even required to pass the competency exam to be licensed in Washington State.

Unfortunately, the typical bank loan officer does not have any control of the process and has limited expertise in mortgage financing. The bank loan officer often does not have access to all of the financial information the bank will be examining to determine whether or not to approve your loan. This can result in situations where the bank’s loan program fails to fit your needs or the requirements of the property you’re buying — causing the locked rate for that program to fail. An experienced mortgage banker uses their expertise to evaluate the best program for the client up-front and has direct contact with the market and the lender’s underwriters.

We wish that were always the case! Unfortunately, it is all too common for the client to find increased fees and even higher rates at the closing table. But at this point, it is too late to do anything about it, as you could lose the house if you do not sign the documents. That’s why it’s so important to have an experienced and ethical Mortgage Banker who is in control of the loan process and uses their expertise and integrity to make sure that the fees are the same as what was quoted to you at the beginning of the process.

This information is solely advisory and should not be substituted for legal financial or tax advice. Any and all financial decisions and actions must be done through the advice and counsel of a qualified attorney, financial advisor, and/or CPA. We cannot be held responsible for actions you may take without proper financial, legal or tax advice.