Earlier this week, one of the largest mortgage brokers in the US shut its doors – not all that uncommon in today’s marketplace. But what was unusual was the candor of the CEO when addressing the challenges of the mortgage broker business model.

“With everything that is going on in the industry, I feel the broker model is dead. With HUD policing 1% origination fee more, the upcoming disclosure of YSP as a fee that is coming out of the borrowers pocket, etc, I think a company really must bank to be competitive.

By enforcing HUD’s requirements and not having the flexibility of a banker to offset it, there are no margins to pay for the proper infrastructure to maintain compliance and QC and have decent margins left. The warehouse line credit is 10% what it used to be so if a company is not a banker already, it is not going to happen.”

For a moment, let’s assume that this CEO is right and that the mortgage broker model is dying – or already dead because it is not profitable.

Is it a good thing if mortgage brokers just go away?

Should the mortgage broker model die will we only be left with the four horseman of the apocalypse, Wells Fargo, Bank of America, JP Morgan Chase, and CitiBank.

Source: The Mortgage Lender via Phoenix real estate blog

File Under: Will real estate brokers be next?

Author Profile

John Ford
John Ford

Over the course of 20 years in the Boston downtown real estate market, John represented and sold numerous, condominiums, investment and development properties in Greater Boston and in the surrounding suburbs

In addition to representing Boston condo buyers and sellers, John is currently one of the most recognized Boston condo blog writers regarding Boston condominiums and residential real estate markets. John's insights and observations about the Boston condo market have been seen in a wide variety of the most established local & national media outlets including; Banker and Tradesman, Boston Magazine The Boston Globe, The Boston Herald and NewsWeek and Fortune magazine, among others.


For over 24 years, John Ford, of Ford Realty Inc., has been actively involved in the real estate industry. He started his career in commercial real estate with a national firm Spaulding & Slye and quickly realized that he had a passion for residential properties. In 1999, John entered the residential real estate market, and in 2000 John Started his own firm Ford Realty Inc. As a broker, his clients have come to love his fun, vivacious, and friendly attitude. He prides himself on bringing honesty and integrity to the entire home buying and selling process. In addition to helping buyers and sellers, he also works with rental clients. Whether you’re looking to purchase a new Boston condo or rent an apartment, you’ll quickly learn why John has a 97% closing rate.


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John Ford and his staff can be reached at 617-595-3712 or 617-720-5454. Please feel free to stop by John's Boston Beacon Hill office located at 137 Charles Street.

John Ford
Ford Realty Inc
137 Charles Street
Boston, Ma 02114



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