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September 22, 2015

Mortgage loan debate: Stick with a bank or go with a broker?

Mortgage posting by Bankrate. So EZ Mortgage Partner UWM vs. Citizens Bank.

Mortgage brokers took a hit following the 2008 financial crisis.

Mortgage brokers vs. bankers

Mat Ishbia
Mat Ishbia
President and CEO of United Wholesale Mortgage.
Partner with So EZ Mortgage
Tom Gamache
Tom Gamache
Northeast Division Manager, Home Lending Solutions, Citizens Bank

They came under greater regulation by the Consumer Financial Protection Bureau, some major bankers stopped working with them and their ranks dwindled, according to Mortgage Professional America.

But banks have suffered their own troubles with regulators and the public.
In June, 6 banks were cited for ignoring requests for loan modifications or failing to make good-faith efforts to prevent foreclosures, while regional banks continue to be hit with investigations by the Justice Department for bad underwriting of Federal Housing Administration loans, according to National Mortgage News.

Whom would you approach for your next mortgage? Who would find the right mortgage and the best rate for you? And, whom would minimize the hassle of the mortgage approval process?

Experts representing mortgage brokers and mortgage bankers make their claims as to why they deserve your trust -- and business.

Good credit can save you thousands on your mortgage. Check your credit for free at myBankrate.

Mat Ishbia

Mortgage brokers

Mortgage brokers are licensed residential mortgage professionals with access to hundreds of loan options for consumers looking to buy or refinance a home. They support borrowers by leveraging relationships and securing the most favorable loan options available. Brokers can help homeowners save thousands of dollars on what is likely the most important financial undertaking of their lives.

Brokers streamline the loan-shopping process by promptly lining up multiple options that borrowers would likely qualify for to allow borrowers to choose the best option for themselves.
While larger lending institutions serve customers, they are not focused specifically on residential mortgage lending. They focus on auto, boat and personal loans, just to name a few. They are not focused on 1 area of expertise: mortgages. Large retail lending institutions can only offer the loan products they have in house, and most often pricing is higher because of the overhead associated with larger institutions and banks.
Brokers, including local banks and credit unions, are typically smaller and more nimble; they adapt to change quickly and have less overhead to be more competitive in the mortgage market. Furthermore, the commission structure for a broker is highly regulated and broker originators have the same pay structure on all loans, no matter what type of loan or loan size.

Tom Gamache

Mortgage bankers

Buying your own home is probably the largest and most important financial decision that any of us will ever make.
To help make that monumental decision, the vast majority of people turn to their bank for a loan rather than to a mortgage broker.

Securing a mortgage offer based on your existing banking relationship can result in a lower interest rate, not just an opportunity during a one-off transaction with an unfamiliar lender.
The reason is pretty simple: Most people already have a relationship with their bank, which has become a trusted partner after providing a range of services over the years, including a credit card, checking account and savings account.

By comparison, a mortgage broker is typically a 3rd-party organization with which you would have had no previous dealings.

You will be unfamiliar with your potential broker, but more importantly they will not know much about you. And that can really influence the kind of deals they offer. Citizens Bank in particular works hard to make banking relationships with customers personal.

On that same note, your bank already knows a great deal of information about you, such as the balances on your checking and savings accounts, and that can help make qualifying for a mortgage a lot easier.

September 16, 2015


In California mortgage brokers are regulated to ensure compliance with banking and or finance laws in the jurisdiction of the consumer. This is not the case in all states, so if you are shopping for a mortgage, it’s recommended you stay with a lender in the state of California. Interestingly, California is the only state that requires mortgage Brokers to have a fiduciary duty to the borrower. Direct lenders do not have this obligation to the client in addition to brokers outside California.


Traditionally, banks and other lending institutions have sold their own products, however, as markets for mortgages have become more competitive, the role of the mortgage broker has become more popular. Today in most developed mortgage markets (especially in Canada, the U.S., the UK, Australia, New Zealand and Spain), mortgage brokers are the largest sellers of mortgage products for lenders.


Mortgage brokers exist to find a bank or a wholesale lender that an individual seeks with a specific loan. Mortgage brokers in Canada are paid by the lender and do not charge fees for good credit applications. So EZ Mortgage has adopted this same policy in the United States.