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5/29/2013

Candians Buying Real Estate In American Jungles?


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I am seeing an increased interest from Canadians who want to purchase real estate in the United States. There are many “experts” out there providing seminars (for a fee) on how to get rich off the American Mortgage and Real Estate Crash. The problem is the advice doesn’t often fit the practical steps to actually make any money.  Holding title in tricky structures will not work with an American mortgage lender. Investing your hard earned money in a jungle, requires careful planning.
Canadians must be aware of the differences in state and local laws, as well as restrictions some cities have about weekly or monthly rentals.  Having a home town expert you can trust is vital. Purchasing property is all about the location. Buying rental property is also tricky when rents can be siphoned in cash. The key is to have safe stop gaps, honest /reliable management and manage costs. The ability to obtain low rate mortgages, locate expert hazard insurance and negotiate costs are advice a Realtor lender and tax advisor can help guide.
Canadian mortgages are different from those available in the US.   Americans prefer a thirty year fixed rate loan where they can count upon low payments and know exactly what to budget for in the future. Canadian loans are typically five or seven years.
Since the crash, obtaining a loan in the United States is a complex number of papers. Two years Canada revenue taxes (showing that you own rental properties already) current paystubs, the past sixty days bank statements and two forms of photo identification are only the start.
There are other decisions such as how to hold, or vest the property. Setting up an entity such as LLC  or Corporation is expensive, adds to ongoing costs and many lenders will not allow this. Conventional mortgages are held in Joint Tenancy so complex strategies that guru get rich quick in real estate experts advise, is not going to work with getting a low rate on a mortgage.
In addition to adjusting to the rules and crazy regulations that Dodd Frank set forth to mortgage loans in the United States, Canadians need to understand all U.S. income tax considerations of owning U.S. real estate. Canadians are subject to American rule as to how rental income and the capital gain on the sale are taxed.

The American Internal Revenue Service (IRS) imposes estate taxes on Canadians who own U.S. property at the time of their death. This tax may apply when the value of the Canadian individual’s estate exceeds five hundred thousand dollars and the U.S. property is valued at more than $60,000. These numbers are U. S. dollars, not Canadian. The estate tax currently has a top rate of 35%. Taxes in the U.S. are likely to only increase.
There are also state specific forms of taxation. For example some States do not charge State Income tax but they collect huge transfer tax fees, require attorneys to handle transactions and on and on.
 
Direct ownership is the simplest avenue to hold U. s. real estate, such as Joint Tenancy or Sole tenancy. However this individual ownership has its own liability risks  for a Canadian individual, who is neither a U.S. citizen nor a U.S. resident, to own U.S. real estate.
Because each individual is allowed his or her threshold amount, ownership of the property can be split between spouses and others (children or family members).
 
In the past Canadians owned personal-use real estate in the U.S. through a single-purpose Canadian corporations. This strategy dos not avoid the U.S. estate tax since the property wouldn’t be held by the individual. In 2004, the Canada Revenue Agency (CRA) indicated that the shareholder of such a corporation would be taxable on the deemed benefit of using a property owned by a corporation,

Ownership through a Canadian trust is another method to eliminate exposure to the estate tax. The Canadian trust alternative can be beneficial for a married couple. Under this form of ownership, one spouse (the settlor) creates the trust for the benefit of the other spouse and children. The settlor funds the trust with cash to purchase the real estate and cannot be a beneficiary or trustee nor have an interest in the capital of the trust. This creates difficulty in opening matching trust bank accounts,
The disadvantages to this type of ownership start with the settlor’s inability to control the trust or to benefit from any trust distributions of money or property. Also, if the settlor is predeceased by the spouse and ownership of the property is continued by the trust, the settlor must pay rent to the trust in order to remain at arm’s length from it so that the IRS cannot deem that the settlor owns the trust property personally
United States citizens can borrow money or acquire a mortgage in a Living Trust but Canadians cannot. Only Living Trusts that are revocable and approved by the lender are suitable. Canadians setup Canadian Trusts for the purpose of avoiding the I. R. S. and providing all the ins and outs of your structure are counter to the purpose.  
Mortgage lenders, banks and financial institutions will freely provide your information to the I. R. S., when asked to do so in the future. The largest lender in the United States is actually the U. S. government, (transparency is the key word).
My advice is to research the risks, ask for advice, and like the elephant above learn from your mistakes.
 

5/26/2013

Curb Appeal

The ten ways to make your home more desirable to buyers.  Curbside Appeal will draw them in.
Front door decorated with simple Fall Leaves- curbside appeal
Fresh Coat of Paint and a Little Handmade whimsy. This Fall decoration on an ordinary Tract Door in an Orange County Condominium complex says "welcome." The owners collected leaves, tied with twine and hung above.

Art is in the eye of the beholder but what you are looking for as a homeowner is - How will a buyer see my entrance from the curb? Symmetry works with these urns in Laguna Beach. The balance and repetition works nicely with the glossy painted black gate. You don't need to be a professional landscape architect or designer to use repetition to appear well put together.

I'm fond of home made and funky. I love this arrangement of birdhouses, wine crates and old windows from Laguna Niguel. The owner took out the broken window panes and attached the chipped wooden frame to mirrors to reflect the yard landscaping.  All the items in the photograph were found for free. The ladder above is hung with heavy twine. Even though all the artifacts are older, the balance again of using two windows framing both sides works well. Also you will notice everything is painted in muted browns and a darker barn red, thus pulling everything together while still saying: unique, homey, and loved

House in Ladera Ranch with a gorgeous use of white wisteria and white picket fence. Notice the white bird houses on the fence that lead you to the door.
Here is another style of picket fence. Isn't this Laguna Beach home just charming? The terra cotta pots with golden flowers lead your eye to want to bring them the newspaper in the mailbox on the left. Owners used broken pieces of concrete and dug a trench about five inches deep, filled with sand and seeded the grass right over the stepping stones. Simple, Cheap and charming front entrance.
Flowers add excitement if you take care of them. This climbing rose around the mailbox and picket fence are multiple shades of corals and yellow. Roses require trimming after booming and like some fertilizer to keep blooming. Choose a cultivar that blooms more than once a year for the front and that is suitable for your climate.

This trellis entrance is very beautiful.

 
 

 

This Laguna Beach home has the most fabulous arrangement of bromeliads, orchids, ferns and exotic plants right at the curb. They have used recycled concrete pieces, found local stone and gravel back filling the walls that act as planters. The loose construction feels relaxed and is barely noticeable among the lush green variety. Don't you want to enter this gate and see the secret garden and tree house?

At the top of Laguna Beach a homeowner added a gate with a Dutch door. The light sconces are especially well done in this arrangement. For my taste it is a little too cold, needs annuals with reds in pots on both sides.
 
 
 
The cheapest ways to improve the curbside appeal of your home:
1. New Paint
2. Annual Color in pots
3. Scrub and clean hardware, clean windows
4. Trim plants not in balls but in natural lacey shapes to see the house
5. Clean up weeds and much beds to look neat
6. Add some personal touches
7. Use balance and color to create a theme
Being on a budget doesn't mean ugly. Go take pictures of other homes with similar bones to yours. If you have brick fa├žade- find houses that feel good and inviting from the curb with the same brick. If you have clapboards hunt around your neighborhood -Laguna Niguel  and Newport Beach are pretty restrictive about paint palettes, so look to Laguna Beach for more whimsy. You won't need to get a new mortgage to finance these suggestions.
 

5/22/2013

Low Payment Condo Orange County California

10 Mira Mesa Rancho Santa Margarita California
Condominium for Sale $ 539,500.00

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1750 Square Feet Three Bedrooms 2 3/4 baths
Listing Agent Jared Ricco  (949) 677-2791
Sausalito Tract

Conventional Loan five percent down payment =$ 26975.00

30 Year Fixed Rate mortgages rates are still at amazing lows!

$512,500.00 loan amount    payment principle and interest  $ 2409.96
                                                                     property taxes                     585.00
                                                                     hazard HO6 policy                35.00
                                                                     HOA fee
This low payment is cheaper than renting.
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This condo is in the Sausalito tract. It has a lovely community pool.

5/14/2013

Laguna Niguel Home For Sale


BEACON HILL SINGLE FAMILY LAGUNA NIGUEL FOR SALE
37 Haverhill, Laguna Niguel, Ca. 92677
 
 New ocean view listing Home For Sale  $850,000 - $899,000
Model perfect 3 bedroom, 2.5 Bath 2000 Square feet,  lot is 5880 square feet. A quiet location at the end of a cul-de-sac . Two community pools, tennis courts, and Malcolm Elementary School a highly desired elementary school in walking distance. A happy house in Orange County! 
 
Everything in this home is remodeled.  Lovely ocean views off the master deck, 5/8" Birch hardwood floors downstairs and new Berber with quality padding upstairs. The kitchen has granite counters with Oggi bullnose finish and Valspar Lacquer Cabinets, 16 gauge commercial quality stainless steel sink and Hans Grohe faucets.
 
The upstairs bath has new 18" travertine floors and tub surround. Relax in a big Kohler drop tub 62" and new Moen brushed nickel hardware. The Master bath has a new full size tiled area with a seat, new Martin shower enclosure with 1/2" thick glass, a new Kohler toilet, a Crema Marfil counter top with double Kohler sinks and a Moen fixture set in the shower and sinks. The exterior is recently painted with Dunn Edwards Everlast Hickory with DE Swiss Coffee Trim. The entire yard is re-landscaped with flowers and sod.
 
$880,000 sales price
20% down = $176,000
 
MORTGAGE TERMS
 
$704,000 Jumbo 5 year interest only first 3.25% APR 3.31%
(rate as of today and rates change several times  a day)
 
$1906.67 interest only
    916.00  property taxes
    100.00 fire hazard
     136.00  Home Owner Association Fees
Subject to qualifying, this is not a rate or loan commitment
 
30 year Fixed payment   $ 3299. principle and interest
 
     

Contact:
 

Tony English
English Realty
(800) 723-8676
(949) 203-8721

 

 
English Realty | Tony English, Broker #01363194  | Laguna Niguel California
 
| 92677

 

5/13/2013

High Priced Mortgage Rule


High cost mortgage loans
Buzzards in Lending Tree
 

Office of Consumer Financial Protection (Bureau) issued the “final rule” to the Dodd-Frank Wall Street Reform and Consumer Protection Act's amendments to the Truth in Lending Act and the Real Estate Settlement Procedures Act with the intention that this would protect consumers from getting bad loans. The final rule expanded the types of mortgage loans that are subject to the protections of the Home Ownership and Equity Protections Act of 1994 (HOEPA).  Consumers who want to move ahead with a high cost mortgages receive information about homeownership counseling providers.

Certain practices were banned with the intention to help borrowers who 1. Didn’t read the disclosures they signed or 2. Couldn’t find a better deal. The rules were supposed to help the individual consumer but in some circumstances the rule harms them. This is exampled in loans under $10000, loans with layered pricing adds and certain high loan to value HARP and HomePath products.
High cost mortgage rules limited the following situations:
  • Balloon payments were banned, unless they are for the seasonal or irregular income of the borrower, or part of a short-term bridge loan, or they are made by creditors meeting specified criteria, including operating predominantly in rural or underserved areas.
  • Creditors are prohibited from charging prepayment penalties
  • Late fees are restricted to 4% of the payment that is past due, fees for providing payoff statements are restricted, and fees for loan modification or payment deferral are banned.
  • Creditors originating HELOCs are required to assess consumers' ability to repay.
  • (Creditors originating high-cost, closed-end credit transactions are required to assess consumers' ability to repay under 2013 Ability-to-repay. Ability to repay by either tax returns, w-2 forms, or bank deposits?
  • Mortgage brokers are prohibited from recommending a consume default on a loan to be refinanced by a high-cost mortgage.
  • Before making a high-cost mortgage, creditors are required to obtain confirmation from a federally certified or approved homeownership counselor that the consumer has received counseling on the advisability of the mortgage.

HIGH PRICED MORTGAGE LOANS ARE NOT Saleable to the GSE’s so  a lender who finds the spread exceeds 1.5 percent over the Average Prime Offer Rate must either reduce the costs or eat the loan.

WHAT is the HPML TEST?  DODD FRANK are two guys who don't understand consumers or mortgage banking.

If a current loan scenario is unsellable because it failed the federal HPML test, the lender is stuck. The APR exceeds comparable Average Prime Offer Rate by 1.5% or more (or 2.5 for Super Jumbo).
Based on the date the interest rate is set (locked or re-locked), lenders must compare their APR with the Fed’s APOR index. The loan will be considered a higher-priced mortgage loan if the APR exceeds the APOR index by:

        1.5 or more percentage points on First Liens

        2.5 or more percentage points on Jumbo First Liens

        3.5 or more percentage points on Subordinate Liens

There are several things that may cause a loan interest rate to go above the

APOR:

 Lower loan amounts – the impact of fees on the APR increases as the loan

amount decreases. A $100,000 loan is more likely to trigger an HPML than

a $300,000 loan. Unfortunately there are fixed costs that are the same for a $300000.

mortgage or a $80000. loan

Mortgage insurance on loans over 100% LTV – The loan may have MI over

a longer period of time because the LTV is in excess of 100% (common in

HARP loans).

 Shorter loan terms – APR fees are averaged over the term of a loan, so the

shorter the term the higher the fee (a 20 year loan will have a higher APR

than a 30 year loan).

Certain products such as HOME PATH that has high loan to value and no mortgage insurance

Borrowers who apply for smaller loans with layered risks will hav difficulty finding a lender. For example a borrower with lower FICO score wants to purchase a condo in Laguna Woods as an investment. There are so many pricing adds, that no rate can accommodate the request. Catch 22.

5/11/2013

Note on Gate: Beware




Real Estate Brokers
ENTER THIS HOUSE AT YOUR OWN PERIL
Duty to Warn of Risks

A recent state Court of Appeal case has clarified a listing broker’s responsibility. In the case of Hall v. Aurora Loan Services, LLC, 2013 DJDAR 5460 (April 16, 2013), the court ruled that a jury can potentially hold the broker liable for negligence where the broker did not warn all persons about conditions in a listing property. In this situation there was a home inspection report which mentioned an attic ladder as being potentially dangerous. Home inspection reports typically list one hundred suggested repairs. The report did not spell out how or why, but image a fold down wooden ladder that opens from the ceiling and allows access to a finished attic. The ladder appeared sturdier than a tree fort ladder but proved to be unstable.

This particular case was filed by Real Estate agent Hall who when showing the property to potential buyers opened the ladder drop down. She proceeded to climb the stairs and a hinge gave way. The snapped hinge caused her to fall and break her leg. Hall sued the listing broker, the lender (as the property was a foreclosure where the owner of record was a bank), and just about everyone involved. She has prevailed on appeal.

In the past, when a property is an REO (real estate owned foreclosure) there were contracts that spelled out in legalese that the seller (often a bank or servicing agent) is in no way responsible for the condition of the property. Since the mortgage bank never resided in the home, they have little knowledge of the condition or maintenance of subject. Buyer beware, is the flag they once flew. This case however seems to overturn the responsibility to listing broker and sellers that a waiver of rights is not enforceable. A listing broker will be held to a higher standard of knowledge and due diligence to advise anyone who not only buys the property, but anyone who walks past the curb.

For example, a broker will have to post a list of possible health and safety hazards to open a property for broker preview or for other agents to access through lock box. Will posting on your entry door: Enter at your own peril be enough to advise the visitors? Probably not, as someone who is blind will claim the disclosure was not properly read to them. Anyone can sue over anything.

No language in the listing agreement will relieve the broker of responsibility on health and safety. Will every realtor who borrows the “feed” – uses the photographs and listing information also be held responsible? I think yes. The far reaching concept of this case is to spread any potential liability across all real estate agents and Realtors.

The buyer's agents may also have responsibility for incidents where parties are hurt or killed while viewing property listed for sale. I can see my beautiful friend Hillary Caston in her Lexus folding down the visor of the passenger seat.

“You want me to check my lipstick in the mirror?” Her buyer in front seat asks.

“No I need you to sign this agreement that if you trip and fall in this house you won’t sue.”


5/04/2013

Camden Park Sounds Lovely


 $424,000. 00 listed for sale 3 bedroom 2 1/2 bath 1390 square feet


Contemporary styled homes in a lovely landscaped development with mature trees. Resort-style community pool and spa for your enjoyment. Walk to elementary school the award winning Don Juan Avila Elementary Close to parks, Aliso Viejo Town Center, the Edwards Aliso Theater and a variety of restaurants.
This condominium has cathedral ceilings in the living room, a large fireplace, 18" stone tile flooring throughout downstairs level, spacious formal dining room area, bright open kitchen with breakfast bar area. Priced at $424000 – a very desirable hot price in Orange County for entry level homeowners.

Camden Park was developed by Ryland homes in 2000 through 2001. The architecture is a combination of Bay and Gable homes seen in Old Town Toronto with verandahs and little towers reminiscent of popular east coast architecture. 

There were 4 floor plans developed in Camden Park. Each Townhouse includes a 2 car attached garage, central heating and air conditioning and fireplace. Many of the units have a nice distant view of the Hills and city lights. 
 There are nine streets that make up the community of Camden Park: Brisbane Lane, Cupertino Cir, Plumeria Lane, Benchmarke Lane, Kenilworth Lane, Open View Lane, Burlingame Lane, Harvest Point Lane and Warmspring Lane.
Camden Park is serviced by the acclaimed Capistrano Unified Public School District. The grade school is Don Juan Avila, and the middle school is also Don Juan Avila. The upper classes are conducted at Aliso Niguel High School.

BUT here is the problem:

It has been close to ten years since the complex was built out. The Association’s Management Company has filed a lawsuit in Orange County Superior Court alleging that the builder completed shoddy work. It is common for lawsuits to pop up in this time frame, as the calendar for a Builder Developer to be responsible is just at the limit of too long for homeowners to file complaints. The suit was filed in August of 2012 and appears to be on track for trial. In fact there have been 70 filings against Ryland Homes for construction defect.
Camden Park sounds and appears at the price points for homeowners lovely BUT it is impossible to buy with an FHA loan and until the lawsuit is clarified getting a mortgage from GSE sponsored conventional is also going to be difficult. Would the Association have been better off negotiating with the Builder?

When there are pending lawsuits of size able nature, and the association may not have sufficient funds to cure or fight the suits it makes it near to impossible to close a mortgage loan in a complex. Owners in Camden Park cannot refinance with today’s low interest rates on conventional loans and Buyers cannot get an FHA loan in this complex.

Physically the main defect is the foam insulation used inside walls and around the window trims. Now after time, heat and moisture the foam is protruding from window wells. The cure would be to pull out the windows, install new sealant and replace, re-plaster and repaint. Each window repair might cost two hundred dollars BUT no telling what dry rot or problems may open up inside each window. The recent lawsuit claims that owners have been unable to track down the real principals of Ryland Homes, but it appears to be a publicly traded company. I believe the sub chapter corporation that built this tract is a separate entity. There are 70 filings against Ryland Homes in Orange County Superior Court.

Larry T. Nicholson, Ryland President did not respond to my inquiry about this complex. He is CEO of Ryland Group. Only comment made was from a receptionist, “we have built 300 homes.”

 
Ryland operates as a home builder, mortgage company, title and escrow company in many states.
I read some thirty complaints to the Better Business Bureau and on complaint boards, then I stopped reading... Most appear to be homeowners who found construction problems in their new homes. They contacted the builder and were given the run around or subcontractors who slapped a fix on half the problems. It is impossible to determine if these complaints are resolved or accurate.

"I contacted Marc Austin thirty times (Operations Manager) with no resolution."

"HOA has received a settlement with regards to shoddy craftsmanship of our Ryland Built Homes. Obviously, Ryland believes it was easier and cheaper to pay off certain HOA boards than to actually fix the problem. My $250,000.00 house is just now 5 years old. In this time, the driveway has started sinking, the front stoop has started sinking, there is a small sinkhole in my..."
"My tub that has a crack that was disguised to pass inspection by Ryland a shower bottom done the same way a false door that leaks into the wall and now shows mold growth btw insurance will not pay claim ryland says the warranty is out of date"

5/03/2013

Types of Mortgage Lenders


Types of Mortgage Lenders
Laguna Beach Red Door Curbside Appeal


Porfolio lenders

A portfolio lender is institution which lends their own money and originates loans in their own name. They are lending for their own portfolio of loans and not worried about being able to immediately sell them on the secondary market. Because of this, they don't have to obey Fannie Mae and Freddie Mac (called GSE’s) guidelines. A portfolio lender can create unique sets of rules for determining the soundness and pricing of a loan.

Often only a portion of their loan programs are "portfolio" product. If they are offering fixed rate loans or government loans, they are certainly engaging in mortgage banking as well as portfolio lending.

Once a borrower has made the payments on a portfolio loan for over a year without any late payments, the loan is considered to be "seasoned." Once a loan has a track history of timely payments it becomes marketable, even if it does not meet Freddie/Fannie guidelines it might be sold in a group to an investor. Or these may be held if the rates are a bit higher, there is a small margin of profitability in holding the servicing. If the lender can sell off loans for a profit (say servicer offers .49% today, they are often grouped into bundles or tranches then sold for a profit to an institutional servicer or investor. The loans are grouped into a Trust that a number of investors may “buy” as a group entity hoping the higher than market rates will not get paid off for a predetermined estimation of time (say they think loans at 5.5% with certain traits: location, FICO, borrower type, age of borrower, just about any set of thousands of details that analysts can rate a bucket).They “guess” the loan will remain in the bucket paying for five more years.

Selling these "seasoned" loans frees up more cash for the "portfolio" lender to make more loans, which is another way that portfolio lenders engage in mortgage banking. If the loans are sold, they are packaged into pools and sold on the secondary market. You will not even know your loan is sold because, quite likely, you will still make your loan payments to the same lender, which has now become your "servicer."


Lenders are considered to be direct lenders if they fund their own loans. A "direct lender" can range anywhere from the biggest lender to a very tiny one. Banks and savings & loans obviously have deposits they can use to fund loans with, but they usually use "warehouse lines of credit" from which they draw the money to fund the loans. Smaller institutions also have warehouse lines of credit from which they draw money to fund loans. Smaller institutions obviously cannot fund big production lumps that always occur when rates are volatile.

Direct lenders usually fit into the category of mortgage bankers or portfolio lenders, but not always.

One way you used to be able to distinguish a direct lender was from the fact that the loan documents were drawn up in their name, but this is no longer the case. Even the tiniest mortgage broker can make arrangements to fund loans in their own name.

Direct lenders are generally companies that underwrite a loan themselves. There are two types of direct lenders. There are about 3200 lenders who call themselves direct but in fact are too small, and undercapitalized to actually fund much direct

Type One: The difference between a direct lender and any other type of mortgage provider, is that they are more nimble. What makes a direct lender different is the fact that they generally have a very large line of credit with another financial institution which allows them to write large checks for your mortgage. However, once the mortgages closed, they will always sell the loan off to someone else to service the loan and collect payments on the loan.

Type Two Direct Bankers who can both portfolio the loans the close and sell them. There are only 100 super funded institutions that can do this. This group is going to be the survivors and drivers when our Federal Government starts to wind down the GSE’s

 


Bathroom Remodel in Woods Cove, Laguna Beach



Correspondent is usually a term that refers to a company which originates and closes loans in their own name, then instead of selling those loans in pools. They sell them individually to a larger lender, called a sponsor. The sponsor acts as the mortgage banker, re-selling the loan to Ginnie Mae, Fannie Mae, or Freddie Mac as part of a pool, or may hold the loans as they follow market trends.

Mortgage brokers deal with lending institutions that have a wholesale loan department.

It is almost like being a mortgage broker, except that there is usually a relationship between the correspondent and their sponsor.


Credit Unions sometimes operate as correspondents, although a large one could act as a portfolio lender or a mortgage banker. They often do not sell loans at all.

Bank 

anks and savings & loans usually operate as portfolio lenders, mortgage bankers, or some combination of both. A bank is a highly regulated institution that does a variety of things. They offer auto loans, credit cards, a checking or savings account, and a home loan, among other things. A bank is generally a one-stop shop for all things financial. Bank employees even the loan officers are not licensed and report to the bank. Loan officers as bank employees are part of a bureaucracy that expects them to sell you a checking account, use their insurance division and open the safe deposit box. Loan officers are not required to be licensed.

Banks tend to drop behind the Wizard’s screen when it comes to deciphering how they handle mortgages. That’s because some banks will service your home loan and own the rights to repayments for the life of the loan, while other banks will sell your loan to a third-party after you sign the paperwork. Most financial institutions that offer mortgages sell them to third parties. That said, some banks will both service some loans and sell others to third parties.


Mortgage brokers

Mortgage brokers are companies, or individuals, who have access to a variety of loan programs through various financial institutions. I actually worked as a mortgage broker for a period of time and we could access mortgages through all of the major banks, direct lenders, and any other lending institution nearby, with the exception of credit unions. The benefit of a mortgage broker is that, assuming you trust yours, he can do the shopping for you with all of the financial institutions he works with.

The other disadvantage is that although they have access to many different programs from many different lending institutions, they are a middle man, which means they will charge a fee for their service. There is nothing wrong with this inherently, in fact, the extra shopping a mortgage broker can do for you may get you the best deal on your mortgage; it’s just important to keep in mind that they do charge a fee for their services.

 

Internet lenders
Mortgage lenders have proliferated on the Internet in recent years, offering fast, easy loans at competitive rates. Some are online channels of brick-and-mortar financial institutions or mortgage brokers, others are Internet-based banks or brokers. Sometimes referred to as Consumer Direct. Where consumer does all the work.  Fine for a cookie cutter wage earner refinancing their only one single family house. Not good for self employed, complex, condominiums, larger loans above $417000, not good for a purchase can’t close on time, often rate lock is not honored.