Ask Dr. Don
By Don Taylor, Ph.D., CFA • Bankrate.com
Mortgage brokers vs. mortgage bankers
Dear Dr. Don,
In your July 28 column you said, "Consumers trying to
decide between using a mortgage broker and a mortgage banker is
a separate question for another column." Could you answer that question
now?
Michelle Maintenant
Dear Michelle,
I've been waiting for your letter, or one like it, to have the
opportunity to respond. I hope you recently came across the letter
in the archives and you haven't been waiting for an answer all this
time. Bankrate.com defines both terms in the mortgage
definition pages. Read on for when to use a banker or a broker.
Mortgage bankers originate, or "fund," the mortgages
that they sell, meaning they put up the money for the loans. Mortgage
brokers are middlemen who shop different originators to find the
deal that best suits their customers. Many borrowers will be able
to use Bankrate.com to find the best rate for their loan. Sometimes
off-the-rack financing doesn't work. If you deal with a mortgage
bank, you have access only to the products they sell. A mortgage
broker can take the particulars of your loan requirements and find
several bankers that offer mortgages that will meet your needs.
You're paying the broker for this service, but the benefits should
outweigh the costs for borrowers who need custom loan agreements.
Michael Larson's recent article
on mortgage brokers is required reading if you're trying to
decide on a broker.
Historical rates
Dear Dr. Don,
Where can I find a chart of 30-year fixed interest rates from
Jan 1, 1998, to now? This is a project for my boss, and I have exhausted
my knowledge on where to find it, and thought you might be able
to help me.
Baffled Bev
Dear Bev,
I can help, but I'm here to tell you that it's time to take
that adult ed. course on using the Internet that you keep putting
off until next semester. I'm assuming that you want the history
on 30-year fixed interest mortgage rates. The
Board of Governors of the Federal Reserve Bank compiles the
information as provided by the Federal Home Loan Mortgage Corp.
There's a ton of other historical interest rate
data on this site. It's the electronic version of the Federal
Reserve Statistical Release H.15 Selected Interest Rates. So
put a bookmark or make a favorite of it. That way you'll be ready
for the boss' next assignment.
Bankrate.com writers base their answers on our editorial
content and advice of financial professionals. We make no claims
or representations about the accuracy, timeliness or completeness
of such content, advice or the answers provided to you. Our content,
advice and answers are intended only to assist you with your financial
decisions. However, by its nature such information is broad in scope.
Your financial situation is unique, and our content, advice and
answers may not be appropriate for your situation. Accordingly,
we recommend that you get different opinions and seek the advice
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final decisions or implementing any financial or investment strategy.
-- Posted: Nov. 17, 1999
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