Over the years banks have become more and more proactive in how they do business with thier clients. Gone are the days when you had to establish a strong relationship with one bank and practically beg them for a chance to borrow lots of money.
In fact if you prefer, most banks will send someone around to visit you with the application forms. These managers are usually called mobile mortgage managers. They usually earn base salary and then bonuses depending on their performance.
Over the years mortgage brokers have become more and more popular with home buyers. In fact in some countries almost 60% of the home loans written are done through a mortgage broker.
A mortgage broker does not work for the bank but is usually paid a one off commission on the settlement of a home loan. A lot of mortgage brokers are in fact ex bankers who have decided to operate their own business.
In New Zealand a mortgage broker usually prepares the loan application with a client and tries to obtain a satisfactory answer from the bank as well as good pricing terms. After this point most brokers will help their clients in the structuring the home loan and ensure that the settlement of the loan goes smoothly. Many brokers these days will continue an ongoing relationship with their clients and help them refix their home loans once their rate has expired.
For a lot of banks, mortgage brokers are another way of obtaining business. As brokers are paid only when they perform, this can be a cost effective way for lenders to do business. In fact some lenders only deal with the public through mortgage brokers.
