Mortgages: Who Are the Players?

The mortgage industry in the United States is a big financial sector, and one of the biggest mortgage industries worldwide. Unfortunately, the U.S. mortgage industry is also one of the biggest origins of debt for Americans. The country currently has over $16 trillion in collective mortgage debt.

If you’re trying to learn more about the twists and turns of the mortgage industry, the first thing you’d like to know is who are the main actors in this billion-dollar are. Whether you’re planning to buy a house, already own one, or someone who’s planning to get into the industry, being aware of the entities you’ll encounter while you’re at it would help you become more aware of what goes on in the industry.

Here’s a list of the mortgage industry’s main actors to help ease you in:

Buyer

What is the mortgage industry without the people willing to spend money? Well, buyers—as we all know—are the ones who are on the lookout for a property. They could be looking to live in the property, sell, or collect to make money off of them in the long run.

They can be first-timers who are the bright-eyed and elated clients on the road for the first time. Or a remortgage client who is seeking to renew an existing mortgage contract that’s still in effect. You can also see movers and buy to lease home buyers.

Depending on what they’re looking for, the industry always has a variety for them to pick from. Your main duty as a buyer is to ensure that you’ll be paying a fair price for the property you want and, of course, to abide by the rules that will be on the mortgage contract.

Seller

The seller is the owner of the property that’s up for sale. They can be selling a house, a condominium, an apartment, or other residential property types. Their goal is to ensure that the property gets sold at the best price at a good time.

They can be individuals, families, financial institutions, housing development companies, or even a government agency. They usually work with agents to look for prospective buyers or work all by themselves to save on real estate agent fees.

Real estate agents

Usually working with a property owner, they are business professionals who are in charge of showing a property through tours, assisting you with price negotiations, and guiding you with the legal requirements you need to accomplish when purchasing the property in question.

They can be working with either the seller, the buyer, or both. A buyer’s agent locates ideal properties and negotiates prices, while a seller’s agent looks for buyers and sells the property at the best possible price.

Mortgage lender

A mortgage lender is a financial entity that lends money to home buyers. They can be commercial banks, savings and loans institutions, credit unions, or other forms of financial institutions that lend money to individuals.

They make money off the interest you pay as you pay back what you owe them to purchase the real estate. They rely on mortgage contracts that are well-examined to ensure that you will repay them as the borrower.

Broker

A mortgage broker represents lenders and borrowers, acting as the intermediary between the borrowing and lending party. They assess the creditworthiness of the borrower against what the lender side can provide. They’re also in charge of the legal requirements both parties need to accomplish. They earn through lender, buyer, or contract commission.

When it comes to buying a home, many more players are involved based on a buyer’s needs. They would want to work with a home inspector, an appraiser, an insurance company, and others. But that would be on them because they’d have to pay for those services.