BROKER VS. THE BANK



Typically, a mortgage broker offers more types of financing than traditional banks. While the bank can only offer loan programs from their institution, the mortgage broker represents a number of banks and other lenders, which results in more financing options for the borrower. Even though brokers have more options to meet your needs, we recommend that you start looking for financing at the bank first. While their options are more limited, if they have an option that meets your needs you will save money because banks can offer financing with cheaper initializing costs than the broker.

This may sound funny, but you need to make sure your loan officer qualifies for your business. The fact is all loan officers are not created equal. You need to make sure that your loan officer is very experienced and up-to-date on the different types of financing programs available. Their loan market is always innovating and developing new financing options. It is absolutely essential that your loan officer is aware of these options. Call around and ask lots of questions when interviewing potential loan officers, for there are far too many who aren't qualified to serve you. If one indicates that they are unable to provide you the type of financing that you're looking for, simply take your business elsewhere.

MORTGAGES AND TRUST DEEDS

A mortgage is a voluntary lien on a piece of real estate. In other words, when a person borrows money to buy a property, the borrower gives the lender the right to take that property if the borrower fails to repay the loan. The real estate acts as collateral for the debt. However, the specific rights the mortgagor (borrower) gives the mortgagee (lender) vary from state to state.

What most people refer to as a mortgage is really a trust deed or a deed of trust. Sometimes, lenders prefer to use a trust deed rather than a mortgage. A trust deed conveys naked title or bare legal title (title without the right of possession) as security for the loan to a third party, called the trustee. The trustee holds the bare title on behalf of the lender, who is known as the beneficiary. The beneficiary is the holder of the note. The conveyance establishes the actions that the trustee may take if the borrower (or trustor) defaults under any of the deed of trust terms.