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Big Bank vs. Private Lender Mortgage Broker in California

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When making a home purchase, you want to ensure you’re getting the best rate and loan terms available. Today, most home loans cover a 30-year period, and while they can be refinanced, many borrowers will keep the same mortgage for the entire life of the loan.

Two main sources for loan origination are big banks and private lenders. Think of big banks as your Chase, Wells Fargo, and Bank of America, but they can also be smaller local banks that offer home financing.

Getting a mortgage from a Big Bank

Big banks can be the right fit for some homebuyers. Borrowers with a stable income and employment history, good credit, clearly defined assets, and looking to make a straightforward transaction might save some time by working with a major bank. Banks are direct lenders, and therefore when working with a loan officer at a bank, they will only have access to the loan products available through their financial institution. As a result, they can’t go shopping around to other institutions to find you a better deal.

Ideally, if you choose to work directly with a bank, you’ve already done the fee and rate comparisons. This usually involves creating a spreadsheet, talking to different banks, and keeping track of their offers. However, one of the benefits of working directly with a bank is that it can sometimes save you money and your direct connection with the bank means that the loan officer might be able to influence how quickly the application is processed.

Working with a Mortgage Broker

Mortgage brokers don’t work with a single bank but many lenders. Their service involves reviewing your finances and the available loan products across the market to find the best deal for your unique situation. This service becomes particularly important for homebuyers with complicated financial backgrounds. An experienced broker like the Simpson Team will know which lenders are best for you to work with and how to source competitive pricing.

Before submitting a loan application, mortgage brokers can help you prep your finances for loan success. They’ll guide you through any changes you can make to ensure you qualify for the loan needed to purchase your dream home.   This customized service is adjusted to each borrower’s circumstances.

Think of a mortgage broker as the middleman between you and all the banks offering loans. They aren’t working for a single company but are working for the borrower to help them understand the different interest rates, fees, and other details to secure the ideal loan. In the long run, working with a mortgage broker can save homebuyers money, time, and stress. Apply Now >

The Simpson Team are experienced mortgage brokers who are committed to outstanding customer service. So if you’re looking to purchase a property, let us do the leg work for you and schedule a no-obligation call with The Simpson Team now.

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