Mandi Feely has been in the Mortgage industry for over 20 years. Her insight into how the industry has changed, and how it operates will provide you with the best service of any home loan originator in Idaho. Take a moment ask her for advice. 

 

 

 

The Benefits of Hiring a Professional Mortgage Banker

The state of the housing market is continually changing due to economic conditions, some of which include interest rates, the availability of money, and inflation rate forecasts. Recently, the housing market has begun to show some definite signs of life and is showing upward trends in some regions, particularly in the Boise area. However, trying to navigate the waters of the housing market without the help of a professional can be frustrating at best, and, even worse, a potential home owner may lose a lot of money with the wrong type of financing.

Many people who are looking to purchase a house, business, or investment property don’t realize the myriad options they have in terms of who is available to help find the best loan, interest rate, and mortgager to meet their unique needs. Mortgage Bankers, while they sometimes appear to cost more initially, are experts in the multitude of home financing options that may be available to you. Professional mortgage Bankers are able to offer a wide variety of services to buyers that can save them a lot of time and, importantly, a lot of money over the life of a home loan.

The Unique Role of a Mortgage Banker:

Simply stated, a mortgage Banker is an intermediary who Bankers home loans between lenders and borrowers. While many buyers will go directly to the lender in order to apply for a loan and work through the terms, interest rates, and types of loans, mortgage Bankers will work with several different lenders in order to Banker the best possible financing arrangement for a borrower. The first choice of a lender based upon a real estate agent's advice or going to an institution where you currently conduct your banking, may not always be the best choice as their options may be quite limited and restrictive.

Why Borrowers Should Work with Mortgage Bankers:

The types of loans available, the complicated terms, and how to qualify for a loan can be quite overwhelming to the average buyer, especially if they are a first time buyer with no previous home financing experience to rely upon. For a buyer to find the best possible deal for themselves, they would have to understand the different types of loans available to them, the varying terms and interest rates, and what type of loan will suit their financial needs the best. Some lending institutions may have a little leeway in offering borrowers different types of loans, but they typically are only able to offer a limited array of certain types of loans with very specific terms. Unless a potential borrower shops around with several lenders, they are often unaware of the possible implications of simply accepting a loan from a specific lender, or their first choice of lender. A professional, experienced mortgage Banker, on the other hand, has relationships with many different lenders and is generally able to negotiate the best possible terms, interest rate, and type of loan best suited for a borrower as well as help the borrower successfully navigate the oftentimes very difficult loan application process.

Typical Services Provided by a Mortgage Banker:

Mortgage Bankers provide potential borrowers an extensive variety of services which can range from processing mortgage paperwork to shopping around to find the best loan to meet their client's needs. Other important services provided by most professional mortgage Bankers include the following:

  1. Gaining pre-approval on behalf of a borrower. Many realtors are hesitant to work with potential buyers until there is a loan pre-approval in place. This is often one of the first steps to obtaining a mortgage loan, and allows buyers to know their limitations in terms of finding a home that is affordable based on their current financial status.
  2. Explaining legal disclosures. There is a lot of legal "red tape" which can sometimes be difficult to navigate for the average borrower. Experienced mortgage Bankers can explain many of these legal disclosures to borrowers so they can become more comfortable with some of the legal aspects of borrowing and how some of these regulations apply to them personally.
  3. Submitting all loan paperwork to the various lenders. There can be many forms and "mountains" of paperwork for borrowers to complete and submit to the lending agency. The possibility that all the proper forms will not be completed or submitted, or some of the necessary paperwork getting lost in the shuffle can be detrimental to obtaining financing for a home mortgage. A well-trained mortgage Banker will ensure all of the necessary forms are completed, will verify the accuracy of the information, and that all paperwork is submitted in a timely manner to the right place.
  4. Assess a borrower’s financial circumstances. In today’s challenging economy, near perfect credit ratings are few and far between. Mortgage Bankers are able to assess the circumstances of each individual borrower in order to determine the best type of loan for them, identify the best possible lender, and secure the best possible interest rate.
  5. Fannie Mae and Freddie Mac Approval. Some mortgage Bankers are designated as approved by Fannie Mae and Freddie Mac for their services. There are strict application requirements for mortgage Bankers to become approved sellers or servicers of Fannie Mae and Freddie Mac loan products. As an approved service provider, loans can be expedited per a standard electronic process.

How Mortgage Bankers can Help Borrowers with Low Credit Ratings:

The economic downturn in the past few years has led to a multitude of lower than desired credit scores for many consumers. Families who are now just getting back on their financial feet might find it difficult to obtain a mortgage loan on their own as a result of some previous, but temporary, difficulty with their credit scores. It can be exasperating and frustrating for those individuals who opted to feed their families and keep their cars to get to and from work as well as job interviews. In some cases, their credit lines were used to the maximum, yet they tried to act responsibly by meeting many of their financial obligations, and not declaring personal bankruptcy. Although some payments may have been late and identified as so on their credit report, they did fulfill their obligations.

By conducting an assessments of an individual borrower’s credit rating and financial situation, mortgage Bankers may be able to help these borrowers qualify for mortgage financing. Utilizing the services and expertise of a mortgage Banker can make finding a mortgage loan with less than perfect credit much easier. Because of their vast network of lending sources, reputable mortgage Bankers who regularly work with less than perfect credit are able to help find creative loan packages and financing for those who are unable to find a loan package anywhere else. Whether it is helping to clean up errors on credit reports, or shopping around for lenders who are more lenient with credit scores, mortgage Bankers are often able to help borrowers find the financing they need for their home loan.

Certification Requirements for Mortgage Bankers:

Because mortgage Bankers must be experts in the field of real estate financing, and because they have access to a clients most personal information, most states require licensing through the NMLS (National Mortgage Licensing System) in order to operate as a mortgage Banker or loan officer. Each state will regulate a mortgage Banker’s lending practices and licensing. This means that mortgage Bankers are individually liable for malpractice, misuse of personal information, and even fraud throughout the life of a loan. There are currently ten federal laws and five federal enforcement agencies which regulate mortgage Banker activities. Each state also has its own rules and regulations regarding the certification and licensing of mortgage Bankers. A reputable mortgage Banker will proudly display their certifications.

Experience Requirements for Mortgage Bankers:

Every state has its own unique laws regarding experience requirements for mortgage Bankers. Some states require simple licensing through a state administered exam. Others require more extensive experience with real estate, finance, and law. The basic requirements for a good mortgage Banker include:

  1. Sales or marketing background. Basic knowledge of sales and marketing can help make mortgage Bankerage a lucrative career choice as well as help a borrower find a good loan program.
  2. Banking or finance experience. While this isn’t always a requirement, those who have a good basic knowledge of banking will be able to better understand some of the logistics and legalities associated with lending and financing. This knowledge will help expedite a loan application.
  3. Understanding of credit reporting factors. Reading a credit report isn’t simply black and white as there is some skill and knowledge required in order to make sense out of reading the information contained within credit reports. This can help a mortgage Banker to better understand the credit worthiness of a particular borrower and help to more adequately match a lender with a borrower.
  4. Proficiency in math, writing, and verbal skills. The ability to calculate interest rates, loan payments, and communicate effectively with both lenders and borrowers will help make a successful mortgage Banker.

Privacy Law Compliance:

Mortgage Bankers are held to the same high standards that all lending institutions such as banks or credit unions are held to with respect to privacy laws and non-discrimination regulations. Regulating agencies ensure borrowers the utmost privacy when using the services of a mortgage Banker. Mortgage Bankers must be careful to protect the privacy of their clients. Misuse of personal information and violations of established regulations can be punishable by extensive fines and/or prison time. Federal and state regulatory agencies are diligent with ensuring privacy compliance. A professional mortgage Banker will explain their privacy policies and practices to you to alleviate any potential concerns.

The Benefits of Working with a Mortgage Banker (Loan Officer):

Working with a mortgage Banker provides borrowers with a one on one personal experience. This can be essential for those who are navigating the waters of mortgage lending for the first time. First time buyers in particular benefit from working closely with a mortgage Banker due to their unfamiliarity with and the complexity of the loan process. Many borrowers have no idea where to even start looking for financing for a home, making the services of a mortgage Banker invaluable. The loan services provided by experienced mortgage Bankers typically include lower closing costs, comparing interest rates, low loan origination fees, all paperwork filed efficiently, documents completed accurately, assistance with completing loan application forms, a quick underwriting and loan approval process, and explanations about the various types of loans and legalities to borrowers. Mortgage Bankers deliver top notch customer service for borrowers by providing answers to questions and acting as a liaison between the lending agency and the borrower. For those who are unfamiliar with the entire buying process, a professional mortgage Banker provides personal attention and will answer any and all questions a borrower may have during the proceedings.

Obtaining a mortgage loan can be a daunting process, even for those who have obtained a mortgage loan in the past. Many new and complex government regulations have been imposed on lending agencies as a result of the recent economic crisis. As a result, the process can be lengthy, confusing, and require a lot of red tape to be worked through. Utilizing the expertise of a mortgage Banker can make the entire process easier for borrowers. Not only does a mortgage Banker exercise expertise in the field of real estate finance, but a mortgage Banker can also help borrowers find the right loan for their unique financial circumstances along with fully understanding the obligations of a particular loan. Mortgage Bankers work to find the best possible loan package for their clients, and can work with a handful of qualified lenders or potentially hundreds of different lenders for a variety of lending packages to choose from. For buyers, the role of the mortgage Banker can be invaluable in the entire home purchasing process.

Summary:

Mortgage Bankers work independently to match borrowers with lenders. Most states require mortgage Bankers to be licensed in order to operate as a liaison between borrowers and lenders. State and federal government regulation agencies ensure compliance with privacy laws and loan discrimination activities. Mortgage Bankers are invaluable with helping to Banker the best possible loan arrangement between a borrower and a lender. First time buyers can benefit significantly from using the services of an experienced mortgage Banker. From help in filing necessary paperwork to providing fast underwriting and approval for the borrower, mortgage Bankers can find the perfect fit between borrower and lender.