Donald Trump's campaign for president on Wednesday proposed raising the interest rates on some home loans to as much as 15 percent.The Trump Mortgage Bank, a subsidiary of his campaign, is the first big mortgage lender to go ahead with such a plan.The move comes after Trump, who has proposed closing the so-called revolving door between Wall Street and the White House, said in a recent interview th...
When you’re ready to get out of your home mortgage and buy a new one, you might be tempted to go with a broker.
But if your mortgage lender offers you a deal with an actual broker, it might not be the best option.
That’s the takeaway from the latest data from the Mortgage Bankers Association of America, released today.
As of December 31, the data shows, less than 1 percent of all mortgages are currently offered by mortgage banks, according to the association.
That makes it the smallest percentage of all the commercial mortgage lending, which is the mortgage business that’s largely managed by banks.
“There is little or no competition in this space,” said John Hagee, chief executive officer of the association, which represents more than 1,300 mortgage banks and brokers.
“The only reason there is a small amount of competition is because the industry is so small.”
Hagee said there are currently only about 40 mortgage brokers offering mortgage loans to consumers.
A few dozen of those offer loan-to-value deals.
The association also says there’s little competition among mortgage lenders.
One reason: There’s no federal regulation of mortgage loan origination or servicing, Hageesaid.
He said there’s not a whole lot of oversight in the industry.
“It is very difficult to find any information about the rates and quality of service offered by a particular lender,” Hageean said.
“A number of people are trying to be able to do this.”
So, what are some of the key differences between an actual mortgage broker and a broker with an “official” role?
For one, a broker’s role doesn’t have to be that of a mortgage lender.
There are other, more specialized roles for mortgage brokers.
They may also handle some of mortgage lending.
A broker may not take on all the mortgage servicing or loan originations, but he or she can help to make sure borrowers get the best deal on their mortgage.
In some cases, a mortgage broker may be a broker for a mortgage company.
For instance, a home loan broker may take on the servicing and origination of home loans, Hagesaid.
But a home mortgage broker doesn’t own the mortgage.
The mortgage loan broker also doesn’t make money directly from the borrower.
Instead, it makes money from the sale of mortgage loans.
This means a loan broker’s income doesn’t directly relate to the amount of mortgage the borrower gets, but it’s tied to the total number of mortgage transactions a lender makes.
“You have to take that into account,” Hagesedaid.
“If you are making a mortgage, you are paying for it.
You are not paying the broker.
If you are a mortgage loan agent, you need to have a clear relationship with the borrower.”
The association has been calling on the Federal Reserve to make mortgage origination and servicing more transparent, Hatesaid.
A key step in this would be to establish a separate program for mortgage loan brokers.
Another key difference between an official and an unofficial mortgage broker is the time commitment the person needs to devote to the job.
An official is an experienced professional, and they’re responsible for a long time.
An unofficial mortgage lender is a newcomer, and the person is new to the business.
Hagesaid said this distinction is often the biggest barrier for many people to understand the mortgage lending process.
It’s a big reason why so many people are stuck with a bad loan, he said.
Some people say they’re already struggling to make ends meet, Halesaid said.
They’ve been unable to find a job that pays enough to live on.
He urged people to start saving now and get themselves into the mortgage broker business.
Mortgage loan broker rates in AmericaAverage annual rate of interest per monthAverage annual principal balance per monthHome loan broker rate, average monthly payment, average annual principal Balance on a mortgage Loan typeHome loan: 30-year fixed rate, fixed term (up to 40 years), no monthly paymentsAverage monthly payment: $3,000, no monthly repaymentsAnnual principal balance: $5,000Interest rate: 2.8%Percentage of loan: 0.5%Annual income: $47,000Hagees said the real benefit of an official mortgage broker over an unofficial lender is that they’ll be there for you for the long haul.
The association said it expects to see a big shift in mortgage lending and originations over the next couple of years, with many people signing up for home loans they can’t afford to pay off.
And it said the growing number of consumers who are getting mortgages they can afford to repay, combined with the rising costs of living, are driving a growing number people to seek out an official lender.