They have access to a wide range of mortgage lending products through relationships with mortgage bankers and depository institutions. Because mortgage brokers are approved through multiple lenders, they have the flexibility to place most loans. Mortgage brokers employ loan officers, who, as described above, work directly with the consumer in obtaining home financing. They assist the consumer in completing the application and loan selection process and direct them to suitable lenders to fund the mortgage. Occasionally, mortgage brokers have relationships with mortgage bankers which allow them to underwrite and fund the loans.
Mortgage brokers charge a fee to assist the borrower with the loan placement.
The fee is paid to the broker when the loan funds. Mortgage brokers are typically regulated by state agencies, such as the Department of Real Estate. Another major participant in the primary market are mortgage bankers. Mortgage bankers are financial intermediaries that review the creditworthiness of a borrower, provide the funds for the loan and quickly sell those mortgages into the secondary mortgage market. Retail mortgage bankers employ loan officers that perform the same functions as mortgage brokers by assisting borrowers with the application and loan selection process.