DORAL REAL ESTATE ARTICLES

Difference between mortgage lender and mortgage broker

Lenders and brokers usually execute a diversity of loan tasks in which the job of  finding eligible borrowers, taking applications, making credit inspections as well as verifying employment and possessions. But the lender is the one who must consent the deal and pay out the money to the borrower. Mortgage brokers are not officially certified  to give any final loan approval, nor do they pay out any money.
According to some experts in economy a lender is the one who puts his money at risk which is something a broker won’t do. This usually derives to correspondent lenders. Many of them have started their careers as brokers. Correspondent lenders work as brokers by keeping away from money market risk. The prices they bring to borrowers come from wholesale lenders with an additional score. When they lock a price for the borrower they at the same time lock it with the wholesale lender. The lender will lock that number in their score. According to the law, correspondents are lenders under existing law. So this states that brokers and correspondent lenders are competitors and have their own rules.