Mortgage Brokers less expensive then Banks

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Economists at Oklahoma State and George Washington Universities studied consumer pricing in the mortgage industry and found that especially in the sub prime (less then steller credit) department Mortgage Brokers were a better option for borrowers.

See article here.

This is especially interesting being a top real estate agent I am pitched by both broker and bankers every week as to why we should choose to go the the source (“The Bank”) vs. going to a broker who can find the best mortgage for the client regardless of the bank.  The banks suggest that brokers mark up their pricing to such an extent that ultimately the consumer pays more going through a broker while fees stay low dealing directly with the bank.  Brokers suggest that because the mortgage business is competitive and they are looking for future business from their clients and agents who refer them business that they charge fees that are at most the same as the banks and in some cases beat the banks.

Staying on top of the trends in local real estate in the markets we serve is a full time exercise.  Staying on top of the pricing of banks and brokers is also time consuming.  It’s good to know there are people out there studying this problem.

1 Comment

  1. Brian Brady
    Jan 26, 2007

    I’m biased…but…I’m pleased

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