Naomi Smith asked:




If you are not familiar with the term mortgage correspondent then you are probably much more familiar with the term mortgage broker. Well, they are really just different names for the same person.

Now, let’s take a look at exactly what this position entails. Specifically, they bring people looking for a mortgage together with companies that are mortgage lenders. They specifically do not provide mortgages though.

The mortgage broker gets paid by collecting a fee from the lending company or fees collected from the borrower. Therefore, a mortgage correspondent facilitates transactions between the lender and the home buyer.

Since they have access to many different lenders, they can be a benefit to the borrower in finding the best and lowest mortgage rates.

Due to increases in mortgage fraud, the industry has become much more regulated, which obviously benefits the consumer. One of the new regulations in the US is that brokers must be licensed before they can even work in the business. In Canada though, mortgage correspondents have been licensed for some time now.

Not everyone goes through a broker to secure a mortgage. You can always go right to your bank and secure a mortgage with them. Often, you can get a reasonable rate working with your existing bank.

The skill of an experienced and knowledgeable correspondent is quite useful in times when the economy is in turmoil such as it is now. A good broker can help analyze and review your current financial situation and in doing so can determine the best mortgage that you may be able to obtain.

Keep in mind that it is getting harder to qualify for a mortgage these days with all the foreclosures happening in the United States. It is making lenders much more strict on the lending qualifications, which is obviously a good thing.

Before choosing a mortgage correspondent, do some research. Make sure the company has been in business for awhile. Speak with some existing clients of theirs if possible. Check with your local Better Business Bureau as well. Even though the industry has improved greatly, you still must do your due diligence.

Philip