Question:

What are the advantages of starting a Mortgage Broker Net Branch?

Answer:

If you have had a Mortgage Broker license - individual or business - for some time now, chances are you considering moving from a Mortgage Broker to a Net Branch of a larger lending entity.

Why do small Mortgage Brokerages try expansion on their own and fail?

Being a Net Branch of a large banking institution kind of makes sense and helps avoid the expensive process of training and hiring underwriters, closers, funders, all different level officers to have the business running.

Not only the costs of expanding a Mortgage Broker business on your own are intimidating, but there are all kind of benefits starting a Net Branch under a big mortgage lending institution.

Moving from a Mortgage Broker into a Net Branch Advantages

Having to forego your corporate identity and the diminishing level of autonomy turns some mortgage brokers away and is the only disadvantage about net branching. However, most lending entities expanding through net branching do allow mortgage brokers to retain part of their autonomy and corporate name and logo, so advantages of becoming a Mortgage Broker Net Branch totally outweigh the identity problem.

  • Loan officers in Net Branching enjoy radical increase in commission and mortgage volume.
  • Largest mortgage lenders and bankers are licensed statewide. This is how multi-state licensing really opens doors for Mortgage Brokers becoming Net Branch.
  • Becoming a Mortgage Net Branch for a bank and/or a direct lender gives the mortgage broker all the power big banks have while sparing them the heavy bureaucracy.
  • Compliance issues have become a lot of trouble for smaller mortgage brokerages and businesses - they simply do not have the staff to ensure all filing and licensing procedures are properly maintained. Being a Net Branch for a large direct lender means you have the financial capacity to keep compliance experts on staff.
  • Being a Direct Lender, or a Direct Lender Net Branch is still more prestigious than brokering.
  • Enjoying lender status means enjoying greater non-disclosure freedom, which is a great gain in the financial world. Also, added automated underwriting capacity pretty much streamlines the whole loan origination process.
  • Also, being a Net Branch instead of a Mortgage Broker means you gain greater Accounting and Support Departments working for you; greater access to state-of-the-art technology and loan origination software (LOS).
  • Last, but not least, trading your Mortgage Broker license for net branching for a large financial institution means all your staff gets training to the latest government (FHA, VA) mortgage products, technology training and mortgage leads supply.

Basically, becoming a Net Branch Affiliate after being a Mortgage Broker does change things a lot. On the whole, you are expanding with the financial and legal help of a large institution and the whole perspective of the mortgage lending process is enlarged for you, without you having to move a finger, and avoiding all the hassle you'd go through to achieve the same on your own.

Mortgage rates hit their lowest since 1955. Ask the home loan experts we recommend Quicken Loans how to take advantage of them.
Was this Mortgage QnA helpful?
Not at all
  • Currently 2.8/5 Stars
  • 1
  • 2
  • 3
  • 4
  • 5
Definitely
Add to this Answer

Mortgage QnA is not a common forum. We have special rules:

  • Post no questions here. To ask a question, click the Ask a Question link
  • We will not publish answers that include any form of advertising
  • Add your answer only if it will contrubute to the quality of this Mortgage QnA and help future readers
If you have trouble reading the code, click on the code itself to generate a new random code. Verification Code Above:
Bookmark and share this QnA: