The Primary Mortgage Market…brokers and bankers and lenders, oh my!

In his entry I’m just going to talk about the different options on the Primary Mortgage Market. The Primary Mortgage Market is where a homeowner or buyer would go to get a loan to purchase or refinance a home. Then, over the next couple of entries I’m going to talk about the other areas that are listed in the diagram.

Primary Mortgage Market

When a borrower wants a loan, they have a choice of:

• Mortgage Brokers – Assist borrowers with the loan process, have ability to submit loans to multiple lenders so that they can find the best “home” for the loan
• Financial Depository Institutions - Savings and loan associations, savings banks, credit unions and commercial banks.
• Mortgage Bankers – Fund loans and quick sell on Secondary Market, can be retail or wholesale
  - Retail mortgage bankers employ loan officers that perform the same functions as mortgage brokers by assisting borrowers with the application and loan selection process. Retail has two areas: Origination and Production
  - Wholesale mortgage bankers do not employ loan officers, but obtain their business directly from mortgage brokers.
  

The Mortgage Industry Fallout....and how it was good for me...

So, home values are falling, mortgage companies are going out of business and the economy is a mess. But, for me, the mortgage industry crisis is not that bad of a thing. After working in the mortgage industry for over 15 years, this downturn in the industry has afforded me the opportunity to actually do what I have wanted to do (and what I should have done right when I graduated from college) – become a teacher. I have talked about going back to get my credential for years, but it is hard to get out of a career where you are pretty settled, making a nice income and are overall enjoying what you do. But, it is not the same as having a passion for what you are doing – which is how I feel about being a teacher.

During college I worked for a mortgage company and learned a lot about the business. I worked in the data entry, document, underwriting, inside sales, secondary marketing and underwriting departments. Then, after college, I went to work for BrooksAmerica Mortgage Company, a wholesale mortgage company, and worked as an Assistant Vice President. At BrooksAmerica I worked in several areas but ended up as a liaison between the programming staff and operations. Additionally, I have done consulting work for several retail loan companies.

So, all that to just tell you that I have some experience in what I’m talking about. Now, not all mortgage companies may do business exactly like this, but my idea was to provide you with a general overview of how the industry works.

Over the next several entries I’m going to talk about the Primary Mortgage market, Broker/Lender responsibilities, the Secondary Mortgage market and then other related mortgage services. So, who knows if you'll find it interesting...but it was pretty fun for the last 15 years of my life.