Comparing Mortgage Brokers? Consider Their Tier-1 Status
Comparing Mortgage Brokers
When comparing mortgage bankers, it is important to understand how they can differ and how those differences can directly affect your loan. Excelling at customer service and being knowledgeable is only half of the equation. What happens behind the scenes can also greatly affect your total mortgage experience.
For example, did you know that wholesale lenders reward elite bankers? That reward is a Tier-1 status which carries with it some significant benefits; like lower rates and faster closings. The Tier-1 status is a reflection of a banker's overall business practices. What sets a Tier-1 banker apart from the rest is a combination of consistent loan volume, quality loan submissions, and exceptional pull-through-ratios.
Consistent Loan Volume
Unlike most bankers that follow trends and float from lender to lender; a Tier-1 banker focuses on building strong partnerships with just a few proven and trusted lenders. This allows the banker to build an impressive volume of business with each of them. The banker is rewarded with lower rates and better pricing for its clients.
Exceptional Pull Through Ratios
A Tier-1 banker is also recognized for having exceptional pull-through-ratios. A pull-through-ratio is the percentage of locked loans that a banker delivers and closes through a lender.
A rate lock is not only a promise between a borrower and their banker, but also a commitment between the banker and the lender. Lenders base their daily rates, in part, on what bankers have promised to deliver and close (locked loans).
A majority of bankers mismanage their business by irresponsibly locking in rates without delivering the loans. Lenders have to offset this risk by increasing rates. The reward for having good pull-through-ratios is access to lower rates and expanded approval guidelines.
Qualified and Complete Loans
Finally, a Tier-1 banker consistently submits qualified and complete loans to their lending partners. The ultimate goal is a "one touch" underwrite. This means that the banker thoroughly pre-qualifies the loan and supplies every document that the underwriter needs to be able to stamp the loan "clear-to-close" on first touch. By limiting the amount of touches by an underwriter, a Tier-1 banker is rewarded with both a delegated team of underwriters to prioritize its loans and the ability to get exceptions to overcome certain guideline infractions.
When a Tier-1 banker excels in all three of these business practices its customers benefit with lower rates, better pricing, underwriting exceptions and much faster processing and closing times. Meridian Home Mortgage is proud to be a Tier-1 banker.