FOR CONSUMERS  

    Doing Business with an Upfront Mortgage Broker

The process of shopping for a mortgage loan is different when you utilize an Upfront Mortgage Broker (UMB). Instead of shopping for a mortgage loan, you are shopping for a mortgage broker. Once hired, the UMB will perform the shopping for the mortgage loan on your behalf.

You should go about the hiring of a UMB as you would any other professional service provider, such as an architect or a lawyer. Specifically, you should ask what is the fee for the services? What services are you receiving for your fee? What are the UMB's qualifications?

The UMB’s fee could be a fixed dollar amount, a percentage of the loan amount, or a combination of both. Once the fee is set, it cannot change. A UMB is required to provide you with the amount of the fee in writing. 

In most cases, the UMB will require information about the transaction before quoting a price for their services.  Consumers can facilitate the process by being prepared to provide information about their financial situation and the transaction.

At a minimum, the services that a UMB provides will be same basic services you would expect to receive from a mortgage broker who is not a UMB. However, because the UMB’s fee is established in advance, you can be assured that the information and counsel you receive from a UMB is objective and un-biased. 

When you interview a UMB, you can certainly ask for information on current mortgage interest rates, but you should not base any decisions on what you hear.  The interest rate quote you get from a UMB is unlikely to be the best, because it will be an honest quote.  Honest brokers cannot compete with mortgage brokers who ensnare consumers by quoting prices they cannot actually deliver.

Once you have hired a UMB to assist you with your financing needs, the UMB is required to operate under the terms of the Upfront Mortgage Broker Commitment. 
  
*Read what the Mortgage Professor says on How to Deal with a UMB.

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         RECOURSE FOR BORROWERS

Any borrower who has reason to believe that a UMB has charged more than the amount agreed upon should send a written statement to UMBA (info@upfrontmortgagebrokers.org) The statement should indicate the reason for the belief, along with a copy of the UMB's written price quote, and the final closing statement (HUD-1).    

UMBs are required to provide their compensation in writing to the borrower. If the UMB forgets, or if you do not find the written statement provided to you sufficiently clear, you may wish to utilize the "Upfront Mortgage Broker Compensation Agreement" - click here to download this form.  

NOTE: UMBA cannot warrant the quality of service provided, or the reasonableness of the prices charged, by UMBs.