Upfront Mortgage Broker and why to choose them

There have been numerous articles written on the Upfront Mortgage Brokers in publications like the WSJ, Time, Money, SmartMoney, etc to name a few.

In today's market, it is imperative to have someone looking out for your best interests. Someone who will work for you and deliver what they promised. Someone who will guarantee their fees in writing.

Visit http://www.upfrontmortgagebrokers.org/ or if you are in Florida, visit http://www.joebartolotta.com/ and look for a registered upfront mortgage broker to assist you with your next purchase or refinance.

We are here to help.

What is an UpFront Mortgage Broker®?
The UpFront Mortgage Broker® (UMB) concept was conceived by Jack Guttentag, the nationally syndicated columnist and well-known expert on mortgage loans. Professor Guttentag developed the idea as a result of his experience as a mortgage advisor to consumers. His website contains information on UMBs and other mortgage related topics and can be found at www.mtgprofessor.com. To be an UMB, the mortgage broker must operate under specific guidelines as set forth in the Upfront Mortgage Broker Commitment.

How does a UMB differ vs. a typical Mortgage Broker?
There are major differences between a UMB and a conventional mortgage broker: UMBs disclose their fees to customers in advance and in writing, and disclose the wholesale prices (rates and points) passed through from lenders. Customers of UMBs pay the broker's fee plus wholesale loan prices. In contrast, conventional mortgage brokers (MBs) add a markup to the wholesale prices, and quote the resulting “retail prices” to customers. Most MBs reveal their markup only in required disclosures after an application has been submitted.

The UMB's Interests are fully aligned with their customers. They can thus represent borrowers in shopping for loans. In contrast, MBs shopping the market are often in a conflict situation with customers. For example:

1. The loan type that best meets the customer's needs may not be the one that allows the largest markup for the MB.
   
2. MBs may profit by ignoring customer requests to lock the rate/points, putting the customer at risk.


3. MBs often increase their markup on customers who allow the rate/points to float by not giving them the best available rate (the float rate) when the loan is finally locked.


4. UMBs credit customers with any rebates they receive from third parties. Mortgage brokers sometimes receive rebates from lenders or concessions from home sellers. UMBs credit customers for any such payments that would otherwise increase the broker’s fee beyond what was agreed upon. In contrast, MBs may or may not credit customers for payments from third parties, depending on the circumstances.

Why should a consumer choose a UMB?
Most consumers are in the market for a mortgage loan only a few times in their life, and have limited time to learn the rudiments, never mind the many nuances, of an extremely complex transaction. The basic nature of the mortgage process allows non-UMBs the opportunity to “mark up” the interest rate and/or increase the fees. The net result is many consumers end up paying more than they should for a mortgage loan.

There is no guarantee that a consumer using a UMB will obtain lowest rate or lowest fees. But, consumers who utilizing a UMB will have the best opportunity to obtain the lowest price for a mortgage loan.