Mortgage Banker
Definition of "Mortgage banker"
Mortgage banker is the person or business that originates mortgages and receives payments.
The mortgage banker typically sells these mortgages to investors and obtains service fees for the loans. The mortgage banker is a major initiator of Federal Housing Administration (FHA) and Veteran Administration-insured mortgages and also serves a key function in the conventional mortgage markets.
Financial help is often sought from a lender, typically a commercial bank. The bank becomes a warehouse for mortgage money, and the mortgage banker draws on these funds until payment is received from the investors. Usually, the mortgage banker continues to service the loan even after the loan has been packaged and sold. For this management service, a small percentage of the amount collected is retained before forwarding the balance to the investor.
The success of the mortgage banker depends upon the ability to generate new loans. In some geographic areas, mortgage bankers are the primary source for financing real estate. All mortgage bankers try to stay in constant touch with investors and are aware of changing market conditions and lender requirements. Quite often the loan origination fee or finder's fee charged the borrower is more than offset by a lower interest rate from a lender not directly accessible to the borrower.
Mortgage bankers are involved in both commercial and residential financing and also carry out related activities such as writing hazard insurance policies, appraisals, and investment counseling. As with mortgage brokers, mortgage bankers are regulated by state law.
Popular Real Estate Terms
Number of small holes in a wall allowing water to drain from it. This makes the walls able to withstand water pressure. ...
Individual who will receive an inheritance upon the death of another. The proceeds of an insurance policy may be in a lump sum annuity. Real estate also passes to the beneficiary. ...
Circumstance where no people or contents occupy or are kept in a building for at least 60 consecutive days. The same stipulations apply to property coverages as found in unoccupancy. ...
Transfer of both real and personal property. An example is the sale of a home with personal belongings. Putting together a group of property to be sold together, perhaps at a discount ...
A column designed to support a concentrated load. A pier column is made out of steel, steel reinforced concrete or wood. A structure extending out into the water supported by numerous ...
To depreciate is to lose value for something. Depreciation is the act of losing worth.Connecting with real estate, Property depreciation can be both an accounting method typically used to ...
Every borrower has his own definition of amortization schedule in mind. An amortization schedule is a table that reveals how the debt is going to be paid back and at what cost. For most ...
If escrow is the legal “moment” where assets are held by a third party (an escrow agent) hired by both the buyer and the seller of goods like real estate and insurance until the ...
The definition of Hypothecation in real estate is the use of one’s belongings as collateral for a loan. This practice assures the lender that, whether the borrower is able to pay or ...
Have a question or comment?
We're here to help.