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338:. Mortgage bankers risk their own capital to fund loans and therefore do not have to disclose the price at which they sell mortgages to another company. Mortgage brokers, on the other hand, earning the same yield spread premium, disclose the additional fee to the consumer because the yield spread premium becomes an additional fee earned and therefore disclosable under federal and state law.
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Mortgage banks sell the loans because the funds received pay down their warehouse lines of credit which enables the mortgage bank to sustain their lending activities. A mortgage bank is not regulated as a federal or state bank and does not take deposits from consumers or businesses. To support their
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fees (provided they are a loan servicer). Many mortgage bankers are opting not to service the loans they originate. By selling them shortly after they are closed and funded, they are eligible to earn a
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operations, a mortgage bank acquires a certain amount of equity, which is then used to secure the warehouse line. The primary source of funds, however, comes from the warehouse lender.
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A mortgage bank generally operates within the framework of the diverse banking regulations that are specific to each state in which it conducts its operations.
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A mortgage bank can vary in size. Some mortgage banking companies are nationwide. Some may originate a large loan volume, exceeding that of a nationwide
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until the loan can be sold to an investor, which are typically large institutions. The credit risk is typically absorbed by the
Agencies, which include
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The market share for mortgage banks in the US of single-family mortgage loans went from 20% in 1980 to over 41% in 1991 during the
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A company desiring to enter the mortgage business often chooses to be a mortgage banker vs. a mortgage broker primarily to earn
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investor that buys the loan will earn revenue for the servicing of the loan for each month the loan is kept by the borrower.
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258:. The difference between a mortgage banker and a
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