In contrast, some MBs will inform the customer that a loan has been locked, but not lock with the lender. This is often a source of extra profit to the broker but it exposes the customer to the risk of being left without a loan if interest rates explode during the lock period. If a customer elects not to lock until shortly before closing, the UMB commits to provide the best wholesale price available on the day the loan is locked. MBs often increase their markup on such customers, who lose their bargaining power as they near closing. By far the most important benefit consumers receive from dealing with a UMB is confidence that the broker is shopping the market in the consumer's behalf rather than in the broker's behalf.
Mortgage brokers can shop lenders much more effectively than consumers.
Brokers are in the market every day, where consumers are in the market a few times during their lives. Brokers receive price information from lenders daily as a matter of course. They know the features of transactions that affect price. They have relationships with multiple lenders, and are therefore well positioned to find and shop among the lenders offering particular features. The potential savings from expert shopping are particularly large for borrowers with poor credit.