What does a mortgage broker do? They’re a matchmaker for lenders and borrowers!
A mortgage broker acts as the middleman between the borrower and the lender, such as a bank or private mortgage company. Their goal is to get the borrower to qualify for a loan, regardless of whether it is a mortgage or refinancing. Think of brokers as a matchmaker. Once they know the needs of the borrower, they’ll work on getting underwriting – otherwise known as loan approval – from a lender.
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What does a mortgage broker do when working with the borrower?
The first thing a mortgage broker will do when they receive a new request for a mortgage quote is gather information from the prospective borrower. In order to assess whether the borrower is a good candidate for a mortgage, the broker will request a credit report, and also gather income, asset, and employment documentation.
After the information has been collected and analyzed, the borrower and the mortgage broker will work together to determine the amount of money the borrower is qualified to request, as well as discuss what type of loan would best suit their personal needs.
Once this process is complete, it’s time for the mortgage broker to then present the completed loan paperwork to the bank or private mortgage company in which they are aligned for processing and approval.
What does a mortgage broker do when working with the lender?
How a mortgage broker communicates with a lender depends on what type of company they are working with.
If the broker works out of one retail bank, they will only be able to get approval from one location. If the broker works for a mortgage agency, they may be able to get approvals and rates from various lending agencies. Regardless of who the broker works with, they are responsible for working with the lender in obtaining a pre-approval and following the sale throughout the entire sales process until closing has finished.
What else does a mortgage broker do?
Mortgage brokers have many other tasks besides being the intermediary between a borrower and lender.
Brokers are responsible for attracting new leads. Because of this, they spend much of their time on marketing and prospecting. They are also responsible for doing presentations on their products so prospective clients can understand their services before they are ready to apply for a mortgage.
As mentioned previously, when a borrower applies for a mortgage, a mortgage broker must gather and verify information. This process can take some time as they work directly with credit agencies and the borrower’s current and former employees.
Once the borrower’s file has been completed and sent to the lender, the broker must stay on top of communication to ensure they will receive a loan approval or rejection. Sometimes mortgage brokers will have the opportunity to negotiate with a lender on behalf of the borrower if a rejection is looming. This might be a change in the loan’s terms for a higher rate or whatever else the lender deems necessary to approve the loan.
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Is there anything else we need to share about a mortgage broker’s job duties? If so, let us know in the comments!