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Best VA Loan Lenders

By: Grant Moon 10/09/12 09:17 am

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Best VA Loan Lenders

 

That’s a solid question: which is better for you when considering a VA home loan? A broker or a banker?  But before we get to that question, perhaps it best that we understand the roles a broker and a banker play during the mortgage approval process.

A mortgage broker is not a lender but instead is authorized to market and originate VA mortgages on a VA lender’s behalf.  A mortgage broker will have several mortgage companies at their disposal, who all offer VA home loans, and can shop around for a competitive rate from their bevy of VA lenders.   A broker takes a loan application from a borrower then sends that application to the selected lender for a VA home loan approval.

Why would a lender use a mortgage broker to find VA loans for them?  Mortgage brokers use their own overhead in terms of office space, loan officers and loan processors in order to find loans and in return their lenders provide interest rates just below market rates.  These lenders are called “wholesale” lenders.

A mortgage banker however does in fact lend the money directly to the borrower. A mortgage banker takes the loan application from the veteran, documents the file with the required paperwork and forwards the application to their underwriter, the individual responsible for approving the loan.

While both methods use the very same VA guidelines during the loan approval process, a mortgage banker has one advantage; more control over the lending process.

This control means decisions are made directly by the lender and discussed with the borrower.  With a brokered loan, the lender communicates with the broker, who then follows up with the borrower. This communication barrier, while at first glance appears nominal, can be a critical factor during the approval process.  A borrower communicating directly with a lender can immediately address any issue and clear up any confusion regarding employment or income status or explain any credit questions.

And unless the mortgage broker specializes in VA Home Loans, which is rare, working with a VA lender directly can help insure that the loan is closed smoothly and professionally.  VA loans have special approval guidelines that other loans don’t have, by working directly with a VA lender, you can be assured you’re working with someone who understands the VA process inside and out.

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