Mortgage - Bank or Broker?

What are the pros and cons of each?

If you didn't use a broker, how did you find the best mortgage rate? We have 20% down and excellent credit.

Re: Mortgage - Bank or Broker?

i shopped around myself.
i always found that banks had slightly higher rates than direct lenders..

i stalked bankrate.com and i called a few lenders and got quotes.

I did not want to go the broker route b.c i was afraid of all the fees they would charge me.
i made sure to get as much information as possible from these direct lenders.. sometimes things are too good to be true.
you just have to make sure that if they quote you a rate, there are no points you have to pay in order to get that rate.
in the end, we used the person that did all of our preapprovals b.c he was always reliable, fast, and efficient.
i found his rate slightly higher than others, so i was able to have him match the rate and waive a fee. i ended up only paying $485 for the application fee and that was it!

i did all the footwork and it was worth it!
i saved us money and was able to make an educated decision b.c i controlled everything!
good luck!

Re: Mortgage - Bank or Broker?

We went with a broker.

It was the best choice for us - we had looked into some banks as well but, the rate the broker was able to get us was a lot better.

There were additional fees but, they were pretty nominal in the grand scheme of closing costs - the broker makes most of his money directly from the lender that the loan is placed with.

Re: Mortgage - Bank or Broker?

We went with our Credit Union. No extra fees, lower rates. Saved us over $5000 than what our friend who had recently become a broker would have been able to do for us.

Re: Mortgage - Bank or Broker?

For someone who has excellent credit and a decent amount of money for the down payment there really are no benefits to a broker. In fact it might be worse to go w/ a broker.

The advantage of a broker is that they generally have a large pool/variety of funding resources as opposed to going to one bank. So the broker may be able to get 100%+ financing loans for someone who has no money down or they might know a lender who is willing to lend to someone w/ less than stellar credit.

For someone in your situation it might be easy to go to 2 different banks and get 2 offers. I'd be surprised if you see more than a 1/4 to 1/8 point difference. Generally you risk lowering your credit score when you shop around for credit but since you have ecellent credit, a few points of a drop in your credit score should not be a concern.

I'm in the process of refinancing and the 2nd bank I went to did question the credit pull they saw from the first bank. I explained to them that I was shopping around for a refi and it was not an issue at all.

Re: Mortgage - Bank or Broker?

We went with a credit union too! We found they had the lowest rates and no fees other than the application fee and fee for their lawyer. The banks were atleast .5% more with extra fees. If you with a broker, find out how they are getting paid and who their fiduciary duty is to. I have heard stories of some last min 'fees' added-that you won't have any control over sitting at the closing table. Check the link for a wealth of home mortgage informationMortage prof

Good Luck!

Re: Mortgage - Bank or Broker?

Stay away from bank of America

Re: Mortgage - Bank or Broker?

we wound up going with bethpage federal credit union. we looked around, online, checked newspapers, etc.
no broker, didn't see the need for one.