Mortgage Broker vs Major banks (Houston, Dallas: lender, to buy, income)

[numbersguy100]

Originally Posted by djslakor

Yeah, when I read that I thought "wtf is this guy talking about?"

Again OP, shopping on bankrate.com is your best bet. Why shop locally when you can shop the entire country for the best rates? With bankrate.com, you can go direct to the lender and cut out the middle man broker.

There is built in fat that brokers, banks, and every online direct lender charge as fees and disguise to the end customer, but the rates in the wholesale market are the same for every single borrower. I can assure you of this.

[houstonview]

my credit union does 5% down no PMI

[Capitalprophets]

Originally Posted by houstonview

my credit union does 5% down no PMI

No PMI on 5%. What is the catch?

[kyam11]

Originally Posted by numbersguy100

There is built in fat that brokers, banks, and every online direct lender charge as fees and disguise to the end customer, but the rates in the wholesale market are the same for every single borrower. I can assure you of this.

Completely irrelevant. You said "don't let a broker or bank tell you they'll get you a better rate than someone else". That is 100% false. I can get a 5.189% rate from Citi for me or you. A bank or broker can get me a better rate at Texas Trust for me or you.

Second, there are some lenders that both service and carry the mortgages and do not sell them. They can have different rates than the wholesale market.

In the end what you said is simply 100% wrong.

[TeamLynn]

Very rarely have I had perfect success with major banks. Normally they're a pain in the @#$@#$@. Closing on time is their biggest problem....occasionally you can find an exception. If you are dead set on using one of the major banks I can point you to some of the loan officers I've had luck with. Typically you don't want to start in the branch. There seems to be specific loan groups that run their own show with their own processors that have success, but most people don't know or understand this.
I tend to like local brokers. I am very picky and recommend, based on success. Success to me is #1 closing on time, #2 competitive rates and low fees. Most people here will comment based on their 1 or 2 purchases or 1 or 2 refis. I'm looking at closing statements so I see the rates and the closing costs.
When you buy through me I also have a loan that has most lender fees waived...like no origination, no underwriting, no application, etc and on loans over $150,000 we give you back $1000 for 3rd party closing costs like surveys or escrow.
In most cases I don't think it is easier to get qualified with a broker vs bank, but that can depend. A great deal for 80% of the buyers.
There are different lenders including banks that have specific loans that can be geared to different standards or qualifications.
I try to recommend specific loan officers for specific needs. One for bad credit, one for certain price range, one for 401k loans, one for VA loans. Guardian has been great in the past for A credit straight forward loans, but many of their great loan officers have left in the past couple of years. BBVA has a great loan for new doctors/dentist with big student debt....think about that only offer letter, no significant current income, and $400,000 in student debt.....most lenders aren't going to touch that. Probably good risk though for someone who might make $200K-$500K and buy a bigger home in 5 years.

Now someone mentioned bankrate.com.... I never recommend that, but I've seen some awesome success and I've seen some failures. They sell your lead to a lot of lenders who then give you quotes. The trick is you never really know if they will perform at the quote or at all until it's too late. I've had lenders bail on people...causing them to darn near loose the house. I've seen interest rates 1-2% higher than quoted...right at the end, when you can't have another lender save you. Very much a gamble at worst, but it can cost you a lot of money if they get it wrong.

Overall I've had many fails with big banks and great success with local brokers....but not all brokers are alike.

[EDS_]

Originally Posted by numbersguy100

There is built in fat that brokers, banks, and every online direct lender charge as fees and disguise to the end customer, but the rates in the wholesale market are the same for every single borrower. I can assure you of this.

But not every mortgage is particularly tied to the wholesale market. Same with some car loans for that matter.

A good number of smaller banks and a couple of really big ones are either full or partial portfolio lenders. I'm very familiar with one local bank that keeps its mortgage paper as an asset that it could sell in whole or in part in case of a reserves or other problem. The rough outline is fairly simple. The customer needs to have nearly perfect credit, excellent to unusual income to debt ratios, mark-up and for profit fees are nearly zero and even though they will take small deals most are fairly large and the rates are below market at least generally. Essentially the lending committee/president decides what the APR will be for the upcoming week and sometimes on a per deal basis.

The first mortgage my wife and I had was from a portfolio lender out of Houston that beat streets rates handily.

[EDS_]

Originally Posted by TeamLynn

Very rarely have I had perfect success with major banks. Normally they're a pain in the @#$@#$@. Closing on time is their biggest problem....occasionally you can find an exception. If you are dead set on using one of the major banks I can point you to some of the loan officers I've had luck with. Typically you don't want to start in the branch. There seems to be specific loan groups that run their own show with their own processors that have success, but most people don't know or understand this.
I tend to like local brokers. I am very picky and recommend, based on success. Success to me is #1 closing on time, #2 competitive rates and low fees. Most people here will comment based on their 1 or 2 purchases or 1 or 2 refis. I'm looking at closing statements so I see the rates and the closing costs.
When you buy through me I also have a loan that has most lender fees waived...like no origination, no underwriting, no application, etc and on loans over $150,000 we give you back $1000 for 3rd party closing costs like surveys or escrow.
In most cases I don't think it is easier to get qualified with a broker vs bank, but that can depend. A great deal for 80% of the buyers.
There are different lenders including banks that have specific loans that can be geared to different standards or qualifications.
I try to recommend specific loan officers for specific needs. One for bad credit, one for certain price range, one for 401k loans, one for VA loans. Guardian has been great in the past for A credit straight forward loans, but many of their great loan officers have left in the past couple of years. BBVA has a great loan for new doctors/dentist with big student debt....think about that only offer letter, no significant current income, and $400,000 in student debt.....most lenders aren't going to touch that. Probably good risk though for someone who might make $200K-$500K and buy a bigger home in 5 years.

Now someone mentioned bankrate.com.... I never recommend that, but I've seen some awesome success and I've seen some failures. They sell your lead to a lot of lenders who then give you quotes. The trick is you never really know if they will perform at the quote or at all until it's too late. I've had lenders bail on people...causing them to darn near loose the house. I've seen interest rates 1-2% higher than quoted...right at the end, when you can't have another lender save you. Very much a gamble at worst, but it can cost you a lot of money if they get it wrong.

Overall I've had many fails with big banks and great success with local brokers....but not all brokers are alike.

That is a great post.

[nissan]

You can also look at Zillow's loan comparison section. You don't have to fill in your personal info, but it'll give you rates/fees by different vendors so you can use that as a starting point to compare vs. credit unions and local brokers.

FWIW I've always found CUs have the best rates/fees on jumbos where the down payment is less than 20%. Both of my CUs offered no PMI, market rate % and standard fees on jumbos with 10% down.

[Bp25]

Some local brokers pass on some of their commission (specially for refi) to the client and can give you reduced closing cost. Just because you cut the middleman when going to large bank does not mean you will get the savings. I have always seen large bank costs more, both in fees and rates, and I have done plenty of purchase and refis for primaries and rentals.

[notkim]

Originally Posted by djslakor

I highly recommend going to bankrate.com and shopping for a mortgage online.

I locked in a 30 year 3.75% last year when local brokers were quoting closer to 4.25%. I had 0 issues closing and everything was perfectly smooth sailing. Local brokers will try to tell you online lenders are sub par, will create closing issues, and you won't have someone "face to face" to deal with. That's all FUD. I used an online lender and it went as smooth as could be ... documents were all electronic, I always had a point of contact, and they were on the ball from start to finish. It was the seller's title company that needed constant prodding (a local business).

Saved myself 20k on the life of the loan.

Hi

If you don't mind sharing, can you tell me who the online lender is/was?

I am getting the same verbiage from a local lender about sub-par service and no face to face with online lenders etc. We had done a very small mortgage 7-8 years back (don't recall the process) and don't remember being friends later with the mortgage loan officer, so honestly it does not matter if we are face to face or not. We made a mistake of not "shopping around" that time bec we were naive. So this time I am doing my due diligence.

We are in the Houston market.