Many years ago, I chose a career as a mortgage broker rather than a bank officer because brokers, contrary to what many think, can offer a wider variety of products at more competitive prices, with apples-to-apples comparisons.
The financial crisis and subsequent mortgage meltdown of 2008 posed some serious challenges to mortgage brokers. Independent lenders halted virtually all residential mortgage lending, and in September 2008, the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac were taken over by the feds.
In an effort to thaw the credit markets, Fannie and Freddie continued to lend and advertised accordingly. The problem was that the banks that sold loans to Fannie and Freddie were getting many of their loans “kicked back,” or were forced to repurchase loans originally bought by the GSEs. Undoubtedly, this made bank underwriters paranoid about approving loans without putting perfectly qualified borrowers through myriad circus hoops to get a simple refinance or purchase loan approved.
Part of my job as a mortgage broker is to ensure that my company is authorized to originate and process loan applications for a variety of lenders. This gives me the flexibility to offer more products to qualified applicants and the ability to shop around for the most optimal terms based upon the applicant’s particular situation and objectives.
While one of the few remaining portfolio lenders (those who don’t sell to the GSEs) recently pulled out of the market, I recently signed up with a new independent lender. Its products and terms are impressive. Here are a few examples:
This is just a sampling of programs not offered by Fannie and Freddie. Though I don’t, and never have, endorsed irresponsible lending and the easy-mortgage-money days of a few years back, the tightening of the credit markets has taken us to the other extreme.
It would be nice if there were more common-sense lenders out there. Not “easy” lenders. Just common-sense lenders.
Henry Savage is president of PMC Mortgage in Alexandria. Send email to email@example.com.
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