Jumbo Loans: Applying with a Mortgage Lender vs. a Bank

  • Jumbo Loans Programs in California.003

Although we welcome jumbo loans, they tend to be secondary services at mortgage lending firms like ours. The reason, it seems, is that many highly qualified borrowers go to their personal banking institutions for jumbo loans instead. Why would this be the case?

Often, it all boils down to the existing relationship that borrowers have with their banks. A recent Wall Street Journal article explains that many jumbo loan borrowers are already clients of their own banks’ wealth management services divisions – and when they are, that relationship trumps all.

“Chances are we know the client, and we know what we are comfortable advancing to that client,” said Mike McPartland, head of investment finance for Citibank Private Bank North America. This is how we feel about our own repeat clientele, so of course we understand that.

However, it’s important for jumbo loan applicants to understand that there are real advantages to applying with a local direct mortgage lender. The advantages to choosing mortgage lenders vs. banks when getting a jumbo loan include:

Less work for the borrower. With a bank, some borrowers find themselves doing much more than they expected they would need to, often because their “home loan specialist” is not a specialist at all – at least not when it comes to mortgages. These are the kinds of banks that expect their borrowers to be their own mortgage experts, which means they aren’t delivering much added value. With a direct mortgage lender, many borrowers get a different (and much better) experience. As mortgage lenders, we already know what legwork needs to be done in order to get your loan moving forward, and we take it upon ourselves to do it. That’s a big advantage over the bank.

A lower interest rate. Sometimes, a mortgage lender can get a borrower a slightly lower interest rate than their hometown bank would. That is often the case here at Wholesale Capital Corporation, where jumbo loan advantages can include wholesale (mortgage lender) interest rates that are lower than retail (banking institution) interest rates, depending on how much their bank marks up the loan. This varies case by case, so jumbo loan borrowers should ask their loan officer if this applies to them.

Better access. For borrowers who want to be kept apprised throughout the loan process and have someone on the phone any time they have a question or concern, it’s hard to beat the personalized service of a direct mortgage lender. Banks – even the hometown branches of a larger bank – can be very bureaucratic, and it may be hard for their borrowers to know who exactly is in charge of processing their home loan. At a local direct mortgage lender, that is much less likely to be the case. It certainly isn’t the case here, because our loan processors are onsite and available to speak with our loan officers at any time. Typically, this results in a better experience for our home loan borrowers.

Faster closing. When a home loan comes from a bank, the escrow can drag on for months – often, because there is little motivation on the part of the bank to close the transaction. At a mortgage lending firm, borrowers are much more likely to close escrow, complete the transaction and get moved into their new home on a practical timeline. Of course, that also depends on the lender – which is why at Wholesale Capital Corporation, we make it our mission to close every client’s loan as quickly as possible. It’s just another one of our many jumbo loan advantages.

Banks are great for banking, but home loans are best handled by experienced mortgage lenders. If you have questions on the benefits of choosing a direct mortgage lender or you want more information on jumbo loan advantages for qualified buyers, call Wholesale Capital Corporation at (855) 640-2020. A knowledgeable WCC loan officer will be happy to speak with you.

Wholesale Capital Corporation is not affiliated with or acting on behalf of or at the direction of the Federal Housing Authority (FHA), the Department of Veterans Affairs (VA), or any government agency or government-sponsored entity. WCC is licensed by the California Bureau of Real Estate, Broker License #01147747 and CA Finance Lender’s License #603K610. Also licensed in Arizona by the Arizona Department of Financial Institutions, MB #0926199. Equal housing lender.