Mortgage brokers will charge you a loan origination fee. Why? Because they will eventually sell your loan to another financial entity. A bank such as Bank of America, Chase or Countrywide can service your loan for life. That means they will make their money on the interest of your loan whereas the mortgage broker needs to charge you up front to sell the loan, often the day you close on the house. Example: Sammy home buyer wants to purchases a home for $100,000 and the mortgage broker will charge him a 1% loan origination fee. His loan would be $101,000. The mortgage broker has created $1,000 equity for them selves.
may not have a choice but to purchase a home with a broker and pay a loan origination fee. Banks on the other hand have the option to waive the origination fee if they plan on servicing your loan for an extended period of time. < Back Next> |
| What is the difference between a mortgage broker and a bank loan? |
