Are Mortgage Bankers Real Banks?

The Mortgage Banker Is Not A Bank

Although you may find a mortgage banker that is advertising as a real bank, which most mortgage bankers do, they are not a direct lender. You may hear a mortgage banker saying, “Do to use using our own money we can give you a lower rate” or “When other lenders cannot make the decision to lend to you, we can because we do our own underwriting.” However these statements are beyond the capabilities of a mortgage banker.

The mortgage banker, like the mortgage broker, is paid a premium by a bank/lender to receive a mortgage. Mortgage bankers will sell a loan before it closes. They will run the loan through their checkbooks and then close the loan to send it on its way to the real lender/bank. Once the real lender/bank has made sure that the loan was completed by the mortgage banker, the bank will send back the money of the loan to the mortgage banker.