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The Essential Benefits of Utilizing Mortgage Brokers

A mortgage broker works as a conduit or an intermediary between the buyer and lender in a real-estate financial deal. The broker is licensed by the state and is often licensed through the Nationwide Mortgage Licensing System and Registry as well.

mortgage broker
mortgage broker

The broker is personally liable for any kind of fraud during the life of the loan, so typically a broker is highly responsible and trustworthy. It is imperative that a broker has integrity and establishes trust between clients in order to build a solid reputation for future business.

To be clear, a broker is not a loan officer and operates as a separate entity from the bank. A broker is often part of a brokerage firm with broker associates. There are many benefits of good brokers.

Highly Trained

Brokers are highly trained individuals who have devoted time and study into understanding the business of real estate. These individuals have been trained in the loan process and funding of various loans. They also meet state requirements, which require study, purpose, and focus.

The training and education which go into become a good broker is challenging and makes for highly trained workers who do good jobs. Highly trained brokers typically find loans that truly work for clients because of their skill level.

Experienced

Perhaps the most vital benefit to a good broker is their level of experience. Experience is key in making smart, wise decisions. To partner with an experienced broker might mean the difference between success and failure in a business or personal venture.

A broker knows the industry, knows home finances and reads constantly about the latest trends in the business. The experience of a mortgage broker is essential to their success as the broker is in charge of his or her own clientele.

They are dedicated to getting clients the best loans that are possible so that their own business can flourish. Even one bad word of mouth conversation can damage a broker’s reputation and they cannot afford that. Brokers work hard to maintain a strong reputation and do not want to make poor judgments that might lead to diminished business.

Expertise

A good broker is an expert on the market. Although the client may read and follow the trends as well, they are not as dedicated as the broker. The broker knows exactly what is possible for the client and how best to serve the needs of the client. The broker is highly motivated to get the job done well. The expertise of the broker benefits the client tremendously in securing the best loan.

A good broker has his or her finger on the pulse of the business world. Presently, social media highly influence the business world.

A broker would be wise to get in on this trend and increase and solidify his or her business. By participating in social media, a broker is able to reach a broader audience, attract new clientele, and advertise his or her business more effectively.

Plus, social media is an excellent way to build a solid reputation for future deals. Social media and new technology have the potential to take the skill and business of brokerage to an entirely new level of success.

How Do Mortgage Broker Commissions Work?

Let’s face it — buying a home for the first time can be really tough.  You’ve got to deal with chunks of money that seem unimaginable, there are about a million lenders who are trying to snag your business, and it’s all on you to make the right decision.  Talk about nerve-wracking!

Adding to the stress, you’re probably looking for ways to save some money WITHOUT cutting corners.  And, you’re realizing that all of the hidden fees and extra costs exceed what you ever thought possible.

That’s why knowledge is power.  If you know how the process works — and what you can do to catch a break — you can make buying your first home easier.

In fact, one of the most important things you can learn is how mortgage broker commissions work.

Who are mortgage brokers?

A mortgage broker will work as a middleman to help you secure a loan, and in exchange for his services, he will receive a commission from the bank once your loan is all set up.  That commission may be paid in full upfront, or it may be done as a “trailing commission” — a series of payments made over several years.  As the buyer, you’ll also be responsible for paying the broker an initial fee, which you’ll be on the hook for, whether you sign on the dotted line of your mortgage or not.

Those initial fees can vary from broker to broker, so check to see exactly what your specific broker’s terms are.  Typically, though, an upfront fee will consist of 0.6% of the total loan.  So, if you get a $300,000 loan, your broker will be entitled to $1,800.  A trailing commission, on average, is about 0.15% of the total loan amount.  So, on a $300,000 mortgage, your broker will get $450 each year.

If that seems like a big chunk of money that you’d rather not spend, don’t worry.  Luckily, you can get much of your money back in an upfront refund or a trailing commission refund.  To do it, you’ll need to take out a “cash back mortgage”.

What’s that?

These mortgages are usually offered by commission rebate services.  That’s a fancy way of saying that they’ll provide several home loan options, and you can choose the one you like best.  That’s a big difference from a traditional broker, who will try to convince you to choose one loan over the other (after all, he’s getting a commission from the bank, so he’s got a stake in your decision!).

Under a cash back mortgage, all you have to do is pick a loan, and the rebate service will refund some or all of your upfront commission.  The exact amount you’ll get back will depend on which company you work with.  For example, some rebate services only return 50% of your money, while others will refund 100%.  This is money that would normally go straight to your home loan broker.  Instead, it will go back in your pocket!

Things will work a little differently on a trailing commission.  Your rebate service might make a slight profit on these deals, while others will offer you a refund based on a specific percentage.  So, talk to your rebate service to see how their exact process will work.

Bottom line — getting a commission rebate is a great way to save yourself thousands of dollars over the life of your loan.  So, before you sign on the dotted line, see if it’s an avenue that’s right for you!

Mortgage Brokers: What You Need to Know

It is tough to start looking into a home loan without hearing someone mention a mortgage broker. Some will have positive comments and encourage a person to use a broker. Others have some reservations about working with a broker as opposed to independently seeking out home loan options. Armed with more information, a consumer can make a decision as to whether or not a broker is the best option for their specific situation.

mortgage broker
mortgage broker

What is a Mortgage Broker?

A mortgage broker can be seen as a mediator between the potential homeowner and the lenders. The broker researches the various loan options and presents them to the customer for their approval. This means getting several opportunities for a loan all at the same time. Instead of shopping around with different banks and lenders, the customer depends on the broker to do a lot of the legwork. There are advantages of mortgage brokers, which are worth looking into.

In addition, mortgage brokers are real estate financing professionals who bring together borrowers and lenders during mortgage transaction. Their prime function is to become intermediary between consumers and lenders as well as help consumers to understand the variety of options of home loan features.

The person who represents you, as a potential consumer, to the home loan lender is a broker. It is the broker’s job to handle the paperwork on your behalf and conduct the market research to ensure you get the best deal.

Very often you could land up dealing with what is known in the trade as a sunshine broker an unscrupulous person who promises you a fantastic rate but forgets to tell you that there are a number of fees that have to be factored in still. When you finally add up your account, you may be in for a nasty shock!

Fortunately, as the market has evolved, a system of ethical brokers has also developed along with it. There is a system of brokers called Upfront Mortgage Brokers who work within a highly evolved code of ethics. They will ensure that every fee or payment is listed out on paper for you to compare and make an informed decision. You may initially feel that the fees that the mortgage broker is charging are high, but you can be sure that there will be no surprises at all.

Actually, the broker’s fees may depend on the amount of work he anticipates to do on your behalf. If you have a bad credit record or are short of some documents, he will probably have to exert himself more and will charge higher. But, and this is important, the charges will be stated upfront.

Yet another reason for using a mortgage broker relates to his knowing the various niche markets that you would otherwise never be able to find out. I know of a couple who were unable to raise enough mortgage, till the broker discovered that the wife was a doctor and was able to get them a plan that provided for 100% mortgage for doctors!

Besides this, the mortgage broker scores over the sunshine broker in another important manner. The upfront mortgage broker is able to get discounts from the actual lenders due to the volume of business he transacts with them. This discount is duty bound to pass on to you directly. A sunshine broker would also be negotiating discounts, but you now know where they would go.

How Can a Person Benefit From Working With a Broker?

Imagine making multiple phone calls or filling out multiple forms online to try to get a few home loan quotes. It takes time to work with each lender individually. With a broker, the bulk of the work doesn’t depend on the customer. It is the broker that handles the research and comes up with all the different loan options. Saving time tends to be one of the most important benefits.

Aside from saving time, it is possible to save money by using a broker. There are all types of deals available to people that know what to look for. Because most people only go through the process of purchasing a home a few times in a lifetime, they don’t have the skills or experience necessary to look for special financing opportunities. A broker is an expert in all things revolving around mortgages and tends to have insider knowledge of programs and discounts that customers can take advantage of.

Are There Alternatives to Working With a Broker?

Some consumers are hesitant to work with brokers because of the way they are paid. In some situations, a broker is given a commission or bonus by getting customers to take certain loans. This is not always the case, but it can cause some concern in people that don’t know a lot about how specific brokers are paid.

The alternative to working with a broker is having the potential homebuyer take over the responsibility of searching for the best home loan and the best interest rates. Anyone can talk to their bank to get a mortgage quote. Anyone can get online and work with different lenders to get more information. In fact, some people do a little bit of research on their own while working with a mortgage broker to ensure they are getting the best deal.

East West Bank or Mortgage Broker?

When talking about East West Mortgage Bank, many are being confused with the wrong company. There are actually two different company that carries a similar name. One is East West Bank Mortgage and the other one is actually 1-800 East West Mortgage. Even though their name is quite similar but they are actually two different entity. Here I would try to differentiate these two companies for you.

East West Bank

Background of 1-800 East West Mortgage

1-800 East West Mortgage Company has been in the market for more than 10 years when it was first established in 1988 on the North Shore of America as a mortgage provider. The company was bought off by Commerce Bank in 2000.

Because of the terrific demand for personal finance and mortgage loan, 1-800 East West Mortgage Company has developed into New England as well and provide the same services to the local citizen.

The company was then shifted its entire operations from Peabody, MA to Marlborough, MA in 2007. You can apply for various financing solutions through the company if you are having financial needs.

You can refer to the website for more information: East West Mortgage

Phone: (800) 327-8937

Address: 171 Locke Dr. Marlborough, MA 01752

1-800 East West Mortgage Website Reviews

Pros
The 1-800 East West Mortgage Website is pleasant to look at but is light on content. The site holds an online application and few calculators but is devoid any substantive articles or information mortgage shoppers need and want. All in all, this was an opportunity missed and it will reflect in my rating.

– by The Mortgage Insider

Cons
They offer a $500.00 closing cost program for mortgages and refinances. The staffs will pursue you to death. If you have any delay, they will warn you if your appraisal does not come in your rate will go up 0.25% point. Naturally, your appraisal doesn’t come in so your in for a higher rate.

Then they won’t tell you there is a desk appraisal where if that doesn’t go through you have to also pay PMI and come to the closing with thousands of dollars in cash. We had credit scores in the 800’s and still went through this baloney with them.

In our opinion, they “stole” our $400.00 application fee and screwed us out of getting lower rates elsewhere with another company. They should be closed down for fraudulent business practices ASAP. We’re going to try to sue them in small claims for our money back. If you have had similar experiences be sure to post here and let’s shut them down!

– by Peeved Paula and Peter

Background of 1-800 East West Mortgage

1800 East West Mortgage
East West Bank, owned by East West Bancorp (Nasdaq: EWBC), provides retail mortgage lending to consumers and also is a wholesale lender for brokers. Their corporate headquarters is located in Pasadena, California and a mortgage center in El Monte. The bank also having branches in New York, Georgia, Washington, Massachusetts, Texas, and overseas.

East West Bank Contact

Website: East West Bank

Phone: (626) 371-8660

Address: 135 North Los Robles Avenue Pasadena, CA 91101

East West Bank Mortgage Review

Pros
The Irving Branch of this UCB is quiet, has a really good staff, and generally manages their customers really well. When tellers are on break, the desk people will deposit your money for you. Go figure! Nowhere else do they do this, not even at their headquarters on Van Ness!

– by Michael C. from Daly City, CA.

Cons
If you don’t speak Chinese, you will face a true difficulty in communicate with the representatives there. I was there trying to open a new saving account and they did not understand half of the questions I had. I understand the bank is mainly servicing the Chinese Americans living in the bay area.

But come on, we are in the USA and they should at least hire bi-lingual people that speak both Chinese and English fluently. Customer service was also not too great. They showed no appreciation of my doing business there.

Also, make sure you read all the terms. There are also a lot of hidden fees! I ended up not opening the account and decided to take my business elsewhere.

– by Ting R from Burlingame, CA.

Warren Paine

Warren is the senior mortgage loan officer who has worked in mortgages and loan industry since 1995. He study in Harvard and major in Finance with a Bsc. Honor Degree. He possesses a Paralegal Certificate as well.

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