Info About The Ypes Of Mortgage Lenders

Mortgage lenders are usually being represented by mortgage companies or banks that provide with home loans. An important aspect which has to be taken into consideration is being represented by the fact that there are basically eight different categories of primary mortgage lenders: correspondent lenders, mortgage brokers, wholesale lenders, direct lenders, portfolio lenders, mortgage bankers, online mortgage lenders, and sub-prime mortgage lenders.

Correspondent lenders are institutions or organizations which can authorize loans on behalf of mortgage lenders. There has to be kept in mind that correspondent lenders act as agents or sponsors of several lenders during the origination and closing of loans, as they are the ones who practically underwrite the loan. Also, correspondent lenders service the loans for the lenders, as they do not group the mortgages for resale, because they sell them individually. Mainly, this is the main difference between correspondent lenders and mortgage brokers or other mortgage lenders.

A mortgage broker can be an individual or an organization that arranges financing for the borrowers through portfolio lenders, mortgage bankers or any other source. Also, there has to be paid attention to the fact that mortgage borrowers act as intermediaries between the lenders and the borrowers. Borrowers are being helped by brokers to choose the appropriate loan program, fill out the loan applications, and locate a lender who can fund the loan, as they also help to obtain the credit report and appraisal.

Wholesale lenders are being represented by any institution which founds and underwrites mortgage loans, as they also service the loan. Keep in mind that wholesale lenders are not dealing with borrowers directly in the retail end of the market, as they deal with a third party, which can be a mortgage broker.

Portfolio lenders are practically wholesale lenders that keep some or all of their mortgages.

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