What questions should you be asking when shopping around for a potential Mortgage Net Branch relationship?
Here is a list of questions (and some editorial remarks) that you may want to use:
Are your mortgage net branch managers permitted to broker outside your system? What restrictions, if any, exist regarding outside brokering? (Some companies say you can broker but later you learn that you may only do so after the company has had first crack at it, or in some cases, only after you’ve closed a certain monthly quota of production).
Can I do mortgage loans in states other than my own? (Some do, most don’t, some charge extra for this, if they do it at all. Many will only allow this through a so-called “in house” corporate branch…complicating and delaying the process and reducing your income and certainty of actually closing.)
Do you have bricks and mortar retail mortgage branches or are your branches within the mortgage net branch network your only source of production? (In other words will I be competing against my own parent company and their advertising – paid for with profits from me?)
What are your junk fees? (They should be low or at least comparable to those of other wholesalers. Anything above $600-800 is probably excessive.)
What fees do you charge per loan?
Do you have any mortgage production quotas? (You may think no production quotas is desirable, but unless you’re a part-timer or a low producer, just the opposite could be true. No production minimums means you belong to a system of branches whose professionalism is probably questionable.)
Does your agreement contain any non-compete language? (Why is that?)
Does your agreement contain any pipeline retention language?
Do the fees I pay you on loans apply to just those loans brokered, or am I going to be paying basis points on loans both brokered and those banked “in house”?
Can I work from a home office? (A failure to require a legitimate, commercial presence, even an executive suite office, speaks volumes about professionalism. You must ask yourself if you want to be part of a strong, no-nonsense mortgage-banking organization.)
I have good working relationships with a few lenders that are not on your list; will you sign an agreement with each of them for me?
How many branches do you have?
In how many states are you licensed (unless your are a national or federal bank and therefore exempt)?
Do I have to buy anything from you? (Like letterhead, forms, business cards, etc. Some require this and it can be very expensive. The branches are retail profit centers for many of these companies.)
Do you have systems in place that will make it easy for me to grow if I choose to expand aggressively?
Will you put an underwriter in my office when we need one?
Which states are you licensed in? (If your company isn’t licensed to do business in all of those “difficult” states, like NY, NJ, AL, NC, SC, CA, VA, MI, and Washington D.C., then they probably aren’t serious, committed mortgage bankers. You should also be certain that you would be permitted to do loans in other states if you choose to. Some companies are licensed in many states but you’ll find out later that they won’t permit you to do loans outside your own state.)
How do you make your money?
Do you have experienced full-time professional support staff that will help me?
Tell me all the fees and penalties that you can charge to one of your branches…are there per-loan fees, delivery fees, rush fees, EPD (early payment default) recourse penalties, administrative fees, payroll fees…please detail ALL of your company’s fees to me!
Why should I consider becoming a part of your branch network?