When it comes to shopping for a mortgage, “broker” is not a four letter word

In the past year, the mortgage industry has certainly taken it on the chin. From Wall Street to Main Street, there isn’t a single person in the industry that hasn’t felt the stinging blow that was created by this tragedy. Sitting right there at the bottom of the totem pole is the mortgage broker. But is he/she the actual culprit? Recently, I’ve seen two programs on television that you can still see online that help you see just who the contributors to this mess really were. 60 Minutes did a piece this past Sunday that you can see on their website. It’s title is “World of Trouble” and reports on a bank called World Savings and how they played a role in this. The other, which requires having close to two hours of free time to watch, was a story on CNBC called “House of Cards.” It reports on several different lending institutions and how they put originators in a corner, only to leave them with the blame when the “house of cards” came tumbling down.
Every industry and profession has it’s bad apples. Some would paint a broad stroke over mortgage brokers, but if a borrower does their due diligence, they can avoid the unscrupulous people within any industry. For years, used car salesmen had that broad stroke painted on them. People didn’t stop buying cars, and people won’t stop purchasing or refinancing homes. The responsibility is on the borrower to make sure that they are working with an honest and reputable mortgage originator, broker or banker.
I myself, have worked only for brokers over my 18 year career in the mortgage industry. The biggest reason is that if you go to a bank to get a mortgage and you are a “square peg” and that bank only serves those who fit into a “round hole”, you’re out of luck. In my opinion, there are no bad mortgage programs out there, but just like a gun, when put into the wrong hands, it can be a lethal weapon, as evidenced by our current market. When shopping for a mortgage, you just need to make sure that you are working with someone who isn’t a “loose cannon.”
I’ve worked for employers who have put fictitious rates in the Sunday paper and been given a list of excuses as to why those rates weren’t available on Monday morning. When the receptionist would announce that there was a someone on the phone calling about the ad in the paper, I would pass on the call.
I worked for one office where, from time to time, the owner would get on his knees and go through the file cabinets of closed files and say things like “He’s gotta have some equity right now. Give him a call.” That office actually had a few people who would leave the file on their desk for a day or two, then give it back to the owner and say “They’re not interested.”
About two years ago, an Account Executive from one of the lenders responsible for the current housing market came into my office for about the 5th or 6th time. I hadn’t sent him a loan and in a very sarcastic tone said, “I don’t understand it. The company up the street is sending me over $1 million a month in loans and I can’t get one out of you…..Oh ya, you won’t do a stated income loan on a W-2’d employee.” (True story!!) My attitude was and still is, if you are a W-2’d employee, you’re getting the same pay every year. If you apply for a mortgage utilizing a Stated Income or No Income Verification loan, you are lying, plain and simple.
So now we get to the new strengths of the broker. The government has set up the Nationwide Mortgage Licensing System or NMLS. Each and every mortgage originator is now required to be licensed by the NMLS which requires a fee, a substantial fee, plus continuing education, another fee. Those unscrupulous loan officers don’t want to pay that so they left the business. The people who did things by the book are left to pick up the pieces and return the integrity to the industry.


If you are in the market for a mortgage, you should shop around, call a few companies, and do your homework. Don’t just ask for a rate, ask for the total amount of money necessary to close the loan. (Sometimes when you ask for the closing costs, the broker or banker may not tell you ALL of the fees). Many of the people seen in the reports mentioned live a very extravagant lifestyle after taking advantage and deceiving hundreds of thousands of people.

My name is Rick Masnyk and I’m the manager of a mortgage broker office. I don’t deceive my borrowers, I don’t live in a multi-million dollar mansion, I don’t drive a fancy car, and I don’t take lavish trips. I am also not a four letter word.