If you want to buy a home for yourself or any commercial property for your business, the most important role to get you the loan is that of the mortgage lenders.

Who a mortgage lender is

The mortgage lenders are those who lend money to you, to buy yourself a home. They keep your home as collateral against the money they are lending.

Types of lenders

There are several types of mortgage lenders. Some of these are:

1. Portfolio lenders: These lenders originate and fund their own loans, so they are able to offer more flexible and unique loan programs, which the other banks cannot offer. They do not have to abide by the guidelines of the secondary market buyers. They offer deposit accounts to the homebuyers.

2. Mortgage bankers: These are the lenders that are quite large enough to originate and create pools of loans, which they sell directly to Freddie Mac and Fannie Mae, jumbo loan investors, etc. Some of these lenders service the loans they originate. They finance the loans with warehouse lines of credit and immediately sell them off in the secondary market, so that they can originate more new loans.

3. Direct lenders: These are the types of lenders who directly work with the homebuyers. They do not need any broker or middleman.

4. Correspondent lenders: These types of lenders originate and offer loans in their own names. After that, they sell the loans to larger lenders, the latter service the loans and sell off in the secondary market. The loan programs are usually based on terms and conditions that are approved by the larger lenders or the sponsors. A correspondent can act as an underwriter. They take the products from larger lenders and resell them in their own names.

5. Loan officers: The loan officers work under the mortgage brokers and do the same job as the brokers. They do not need a license for their job. They solicit mortgage borrowers by telemarketing, mailing, etc. They take a commission from the brokers.

6. Mortgage brokers: They work on their own with the borrowers, lenders and the banks. They need a license to do this job. They contact borrowers and offer them with potential deals. Once the borrower chooses a deal, the broker sends him to a wholesale lender or a bank. A broker also processes the loan after it gets approved and negotiates with the lenders about the pricing, to get a rebate.

Prior to selecting a lender, you should know in details about the lender himself, and also the loan programs offered by him. You should choose a lender in such way that you will not get overcharged and get a loan that suits you the best.