To Hire A Mortgage Broker? It's a No Brainer!

The current administration’s favorite “whipping boy” for the housing collapse is the mortgage broker.  I will be the first to admit that some of the whipping is deserved as there were dishonest and criminal mortgage brokers that existed among us.

One of the things our elected officials did to address this is to pass the SAFE Act to provide a Nationwide Mortgage Licensing System and Registry for mortgage originators.  The SAFE Act was intended to provide uniform licensing standards nationwide, as these licensing standards had not been uniform from state to state.  

However, since the law’s inception mortgage brokers have been held to stricter regulations than originators employed at federally regulated financial institutions (banks).  An uneven playing field has been established for mortgage lenders and given banks the upper hand.  One such inequity is that mortgage brokers are governed by a host of federal laws and regulations, while federally chartered banks and there loan officers are protected under the FDIC and are not required to pass state and federal licensing tests, have continuing education and pass a criminal background checks like mortgage brokers are.   

The licensing process for mortgage brokers is much more comprehensive.  For this reason alone a mortgage broker is preferred.  

To compliment that, Mortgage Brokers also have a broader product line because of their numerous business partners, are the most efficient means of loan origination, are more nimble and generally priced lower than banks.