Realtor in Saint Petersburg, FL | Jeff Copeland

Types of Lenders

You mean there are different kinds?

Yep! There are two types of mortgage lenders that are relevant to first-time home buyers – 1) mortgage brokers, and 2) direct lenders (or mortgage bankers).

Mortgage Brokers – If you’ve ever shopped for car insurance, you probably realize that many insurance agents don’t just sell insurance policies for a single company. Instead, they take the information about your car and driving record, then shop around with several insurance carriers to see who offers you the best rate and/or the best coverage. Mortgage brokers operate in a similar fashion – they take your loan application and then shop around for the best rate or the loan product that best meets your needs.

Direct Lenders / Mortgage Bankers – As you may have already guessed, direct lenders take a more…direct approach. They loan you money directly from their institution and service your loan for its duration.

While one is not necessarily better than the other, direct lenders can sometimes be more responsive, or more flexible when it comes to unusual circumstances with regards to your credit history or income.


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