Banker Vs. Broker
What is the difference between a Direct lender and a mortgage broker? You may find your self talking to a mortgage broker and wanting to know what the difference between a mortgage broker and a mortgage banker is. Both can originate CalPERS loans based on the actual published CalPERS home loan guidelines. Since the rates are posted by Citi Mortgage directly, they both will have the same interest rates on the same days. However, the broker is at a slight disadvantage when it comes to control over the loan process. Mortgage brokers are not actually funding the loan with their own money and they have to go through an approved direct lender to get the loan underwritten, loan documents drawn and the money to fund the loan. This could be difficult in a situation where time is of the essence as the mortgage broker does not have control over these steps and is subject to the lenders time lines.
On the other hand there is the CalPERS approved direct lender who manages and controls the entire loan process in house. This can dramatically improve the time it takes to process, underwrite and fund your loan as well as skipping a “middle man”. You may also find that mortgage brokers often charge the full 1.25% maximum allowable origination fee set by the loan guidelines.
If you are considering getting a “PERS” home loan, you should consider talking to a CalPERS Approved Direct Lender and see what the difference is.
Sean Safholm, Determined to help you succeed!
