Advice Needed: Transitioning Away from a Hard Money Broker
Flipper/Rehabber · Birmingham, AL · Member since 2025 · 23 posts · 16 votes
Advice Needed: Transitioning Away from a Hard Money Broker
Most Popular Reply
Member since 2025 · 9 posts · 1 vote
1yAs a mortgage broker I bring private lenders to my clients. They will never go around me as it's an unwritten rule of doing business not to go direct once the broker brought the borrower. Think of it as your mortgage broker is your private money admin. But if your using the same money source every time you can shop around for a broker that would only charge 50 bps or less or call and research hard money lenders on your own. But you then experience the pain of what we experience as mortgage brokers in correct me and kissing a lot of frogs to find lender's that are actually worth a damn actually fund the deals on time.
31 Replies
Quote from @James Jackson:
Hey BP Community,
I’m in a situation with my hard money lender that I’d love some advice on.
Currently, I’ve been working through a hard money broker to secure funding for my deals. However, I’d like to work directly with the lender moving forward to streamline communication and save on broker fees.
There’s no legal agreement binding me to the broker. However, the lender is hesitant to work directly with me because they’re worried about damaging their relationship with the broker, who could potentially take business elsewhere.
Has anyone dealt with this type of situation?
-
How did you approach the lender to convince them to work directly with you?
-
Any tips for maintaining good relationships while making this transition?
-
Am I missing any ethical or reputational concerns I should be aware of?
I appreciate any thoughts or experiences you all can share.
Thanks in advance!
The average broker does not actually have the funds to lend you.
Hurst Real Estate, INC4.991 Reviews-
- Flipper/Rehabber · Birmingham, AL · Member since 2025 · 23 posts · 16 votes1y
Yes sir, I am aware. I have done about 5 deals with the current lender that we use through the broker. I am getting charged pretty hard in broker fees and really want to end the broker relationship and deal with the lender directly.
- Lender · Atlanta, GA · Member since 2019 · 241 posts · 41 votes1y
@James Jackson I Would Love To Connect I Work Directly With Clients...
Do you mind sharing what the broker is charging on average? A lot of brokers will work wholesale with the lender so you shouldn't be paying too much more than even if you went direct.
- Flipper/Rehabber · Birmingham, AL · Member since 2025 · 23 posts · 16 votes1y
Quote from @AJ Exner:
Do you mind sharing what the broker is charging on average? A lot of brokers will work wholesale with the lender so you shouldn't be paying too much more than even if you went direct.
There is not a set fee honestly. It fluctuates based on the loan amount. I get his with three fees. Broker fee, broker liaison fee, broker doc processing fee. I am also paying double for the appraisal. I can PM you a real number if you want to see it.
- Member since 2018 · 4 posts · 0 votes1y
@James Jackson Please PM me that number too. Interested in seeing what others are getting charged for
- Member since 2025 · 9 posts · 1 vote1y
As a mortgage broker I bring private lenders to my clients. They will never go around me as it's an unwritten rule of doing business not to go direct once the broker brought the borrower. Think of it as your mortgage broker is your private money admin. But if your using the same money source every time you can shop around for a broker that would only charge 50 bps or less or call and research hard money lenders on your own. But you then experience the pain of what we experience as mortgage brokers in correct me and kissing a lot of frogs to find lender's that are actually worth a damn actually fund the deals on time.
- Flipper/Rehabber · Birmingham, AL · Member since 2025 · 23 posts · 16 votes1y
Quote from @Jacob Haddan:
As a mortgage broker I bring private lenders to my clients. They will never go around me as it's an unwritten rule of doing business not to go direct once the broker brought the borrower. Think of it as your mortgage broker is your private money admin. But if your using the same money source every time you can shop around for a broker that would only charge 50 bps or less or call and research hard money lenders on your own. But you then experience the pain of what we experience as mortgage brokers in correct me and kissing a lot of frogs to find lender's that are actually worth a damn actually fund the deals on time.
I guess I worded that portion of it wrong and if I did I apologize. I am not trying to go around the broker at all. I have asked the broker and the lender to be released from the broker relationship. I am not sneaking around or trying to double cross anyone.
- North East Ohio · Member since 2025 · 10 posts · 0 votes1yTruer words never spoken lol
Quote from @Jacob Haddan:
As a mortgage broker I bring private lenders to my clients. They will never go around me as it's an unwritten rule of doing business not to go direct once the broker brought the borrower. Think of it as your mortgage broker is your private money admin. But if your using the same money source every time you can shop around for a broker that would only charge 50 bps or less or call and research hard money lenders on your own. But you then experience the pain of what we experience as mortgage brokers in correct me and kissing a lot of frogs to find lender's that are actually worth a damn actually fund the deals on time.
- Lender · Member since 2021 · 495 posts · 130 votes1yIs there any give and take with the broker? When we have done loans wholesale, often times the fees are the same, only slightly higher, or even lower than going direct. You also can get better communication and service than direct.
Quote from @James Jackson:
Hey BP Community,
I’m in a situation with my hard money lender that I’d love some advice on.
Currently, I’ve been working through a hard money broker to secure funding for my deals. However, I’d like to work directly with the lender moving forward to streamline communication and save on broker fees.
There’s no legal agreement binding me to the broker. However, the lender is hesitant to work directly with me because they’re worried about damaging their relationship with the broker, who could potentially take business elsewhere.
Has anyone dealt with this type of situation?
-
How did you approach the lender to convince them to work directly with you?
-
Any tips for maintaining good relationships while making this transition?
-
Am I missing any ethical or reputational concerns I should be aware of?
I appreciate any thoughts or experiences you all can share.
Thanks in advance!
Try having a conversation with them first, if they value the relationship, they should be willing to work with you. If you are not getting great communication and the relationship sucks, it’s also a good thing to bring to their attention. If they choose to let go of the relationship, then you have your answer on how to proceed.- Flipper/Rehabber · Birmingham, AL · Member since 2025 · 23 posts · 16 votes1y
Quote from @Andrew Zamboroski:
Is there any give and take with the broker? When we have done loans wholesale, often times the fees are the same, only slightly higher, or even lower than going direct. You also can get better communication and service than direct.Quote from @James Jackson:
Hey BP Community,
I’m in a situation with my hard money lender that I’d love some advice on.
Currently, I’ve been working through a hard money broker to secure funding for my deals. However, I’d like to work directly with the lender moving forward to streamline communication and save on broker fees.
There’s no legal agreement binding me to the broker. However, the lender is hesitant to work directly with me because they’re worried about damaging their relationship with the broker, who could potentially take business elsewhere.
Has anyone dealt with this type of situation?
-
How did you approach the lender to convince them to work directly with you?
-
Any tips for maintaining good relationships while making this transition?
-
Am I missing any ethical or reputational concerns I should be aware of?
I appreciate any thoughts or experiences you all can share.
Thanks in advance!
Try having a conversation with them first, if they value the relationship, they should be willing to work with you. If you are not getting great communication and the relationship sucks, it’s also a good thing to bring to their attention. If they choose to let go of the relationship, then you have your answer on how to proceed.I would be more open to keep the broker if the communication was stream line. I am still having to communicate with the lender pretty often when things happen or if something goes wrong when processing the loan. I also have issues getting documentation when needed like my signed term sheets. I am not going to say the relationship sucks.
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- Lender · Member since 2021 · 495 posts · 130 votes1yA broker should be earning their value. It sounds like you have not had the best experiences, so your quest makes sense. Good luck at your sort through it!
Quote from @James Jackson:
Quote from @Andrew Zamboroski:
Is there any give and take with the broker? When we have done loans wholesale, often times the fees are the same, only slightly higher, or even lower than going direct. You also can get better communication and service than direct.Quote from @James Jackson:
Hey BP Community,
I’m in a situation with my hard money lender that I’d love some advice on.
Currently, I’ve been working through a hard money broker to secure funding for my deals. However, I’d like to work directly with the lender moving forward to streamline communication and save on broker fees.
There’s no legal agreement binding me to the broker. However, the lender is hesitant to work directly with me because they’re worried about damaging their relationship with the broker, who could potentially take business elsewhere.
Has anyone dealt with this type of situation?
-
How did you approach the lender to convince them to work directly with you?
-
Any tips for maintaining good relationships while making this transition?
-
Am I missing any ethical or reputational concerns I should be aware of?
I appreciate any thoughts or experiences you all can share.
Thanks in advance!
Try having a conversation with them first, if they value the relationship, they should be willing to work with you. If you are not getting great communication and the relationship sucks, it’s also a good thing to bring to their attention. If they choose to let go of the relationship, then you have your answer on how to proceed.I would be more open to keep the broker if the communication was stream line. I am still having to communicate with the lender pretty often when things happen or if something goes wrong when processing the loan. I also have issues getting documentation when needed like my signed term sheets. I am not going to say the relationship sucks.
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Legal obligation? No. But I agree that it’s an unwritten rule: you shouldn’t go around a broker, @James Jackson. As a five-time repeat customer, however, I guarantee that neither the lender nor the broker wants to lose you to their competition — which I’m sure they recognize is numerous.
I would have a strong discussion with this broker and negotiate costs and fees. (Broker liaison fee? C’mon.) I don’t know whether brokers are fiduciaries in AL as they are here in CA, but he might not be adding value for you anymore. In addition to addressing his costs, this broker should be negotiating with the lender on your behalf as well. You have every right to expect all of your suppliers to continually earn your business. This broker is no exception.
In parallel, you might find some lenders on your own. This isn’t hard, James. In fact, we don’t work with brokers at all and find our borrowers directly at local real estate clubs. Both Meetup and Eventbrite are good sources.
Here’s a meetup link to real estate clubs near Birmingham. As a proven entity, all the lenders in the room will want to get to know you. Go to lunch with a few and form some relationships. You’d be smart to build a network of lenders and keep a stable in your back pocket that you can pick and choose from as your deals, and their criteria, align.
Don’t feel stuck, James — you’re bringing them the business, not the other way around.
- Flipper/Rehabber · Birmingham, AL · Member since 2025 · 23 posts · 16 votes1y
Quote from @Jeff S.:
Legal obligation? No. But I agree that it’s an unwritten rule: you shouldn’t go around a broker, @James Jackson. As a five-time repeat customer, however, I guarantee that neither the lender nor the broker wants to lose you to their competition — which I’m sure they recognize is numerous.
I would have a strong discussion with this broker and negotiate costs and fees. (Broker liaison fee? C’mon.) I don’t know whether brokers are fiduciaries in AL as they are here in CA, but he might not be adding value for you anymore. In addition to addressing his costs, this broker should be negotiating with the lender on your behalf as well. You have every right to expect all of your suppliers to continually earn your business. This broker is no exception.
In parallel, you might find some lenders on your own. This isn’t hard, James. In fact, we don’t work with brokers at all and find our borrowers directly at local real estate clubs. Both Meetup and Eventbrite are good sources.
Here’s a meetup link to real estate clubs near Birmingham. As a proven entity, all the lenders in the room will want to get to know you. Go to lunch with a few and form some relationships. You’d be smart to build a network of lenders and keep a stable in your back pocket that you can pick and choose from as your deals, and their criteria, align.
Don’t feel stuck, James — you’re bringing them the business, not the other way around.
Thank you. We for sure do not feel stuck, we just have to tighten up as the market does and the fees don't work to keep us sustainable. I am working locally to find some true private money lenders. We are not trying to backstab the broker at all. I told them all on a call I no longer want to be with a broker, I for sure understand how the lending world works and that why I was really honest with everyone. They for sure do not want to lose me but at the end of the day the broker fees are eating up profit quickly.
We have had the conversation multiple times and it honestly just falls on death ears. I have had to negotiate everything with the lender directly including me terms and interest rates. - 1yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Jeff S.:
Legal obligation? No. But I agree that it’s an unwritten rule: you shouldn’t go around a broker, @James Jackson. As a five-time repeat customer, however, I guarantee that neither the lender nor the broker wants to lose you to their competition — which I’m sure they recognize is numerous.
I would have a strong discussion with this broker and negotiate costs and fees. (Broker liaison fee? C’mon.) I don’t know whether brokers are fiduciaries in AL as they are here in CA, but he might not be adding value for you anymore. In addition to addressing his costs, this broker should be negotiating with the lender on your behalf as well. You have every right to expect all of your suppliers to continually earn your business. This broker is no exception.
In parallel, you might find some lenders on your own. This isn’t hard, James. In fact, we don’t work with brokers at all and find our borrowers directly at local real estate clubs. Both Meetup and Eventbrite are good sources.
Here’s a meetup link to real estate clubs near Birmingham. As a proven entity, all the lenders in the room will want to get to know you. Go to lunch with a few and form some relationships. You’d be smart to build a network of lenders and keep a stable in your back pocket that you can pick and choose from as your deals, and their criteria, align.
Don’t feel stuck, James — you’re bringing them the business, not the other way around.
We are the same we don't work with brokers. And I do a ton of stuff in B ham its all direct to the clients I have there.. of course we don't advertise its all word of mouth and we are super picky on who we decide to help grow their business.. One of my current clients there I have been with since about 2005.. And have watched him work through the GFC which was exceedingly painful for both of us but we got through it and that's the extreme value of working with a a private direct lender we don't answer to those above us.. Today he has close to 300 SFRs in and around B ham is a major force at auctions ( I help fund those) etc etc. having 2 people get fee's before you get to the actual source is pretty wild never heard of that seems like some sort of daisy chain. Brokers have there place no doubt but if one can get direct with the money deals go smoother and much faster. - Flipper/Rehabber · Birmingham, AL · Member since 2025 · 23 posts · 16 votes1y
Quote from @Jay Hinrichs:
Quote from @Jeff S.:
Legal obligation? No. But I agree that it’s an unwritten rule: you shouldn’t go around a broker, @James Jackson. As a five-time repeat customer, however, I guarantee that neither the lender nor the broker wants to lose you to their competition — which I’m sure they recognize is numerous.
I would have a strong discussion with this broker and negotiate costs and fees. (Broker liaison fee? C’mon.) I don’t know whether brokers are fiduciaries in AL as they are here in CA, but he might not be adding value for you anymore. In addition to addressing his costs, this broker should be negotiating with the lender on your behalf as well. You have every right to expect all of your suppliers to continually earn your business. This broker is no exception.
In parallel, you might find some lenders on your own. This isn’t hard, James. In fact, we don’t work with brokers at all and find our borrowers directly at local real estate clubs. Both Meetup and Eventbrite are good sources.
Here’s a meetup link to real estate clubs near Birmingham. As a proven entity, all the lenders in the room will want to get to know you. Go to lunch with a few and form some relationships. You’d be smart to build a network of lenders and keep a stable in your back pocket that you can pick and choose from as your deals, and their criteria, align.
Don’t feel stuck, James — you’re bringing them the business, not the other way around.
We are the same we don't work with brokers. And I do a ton of stuff in B ham its all direct to the clients I have there.. of course we don't advertise its all word of mouth and we are super picky on who we decide to help grow their business.. One of my current clients there I have been with since about 2005.. And have watched him work through the GFC which was exceedingly painful for both of us but we got through it and that's the extreme value of working with a a private direct lender we don't answer to those above us.. Today he has close to 300 SFRs in and around B ham is a major force at auctions ( I help fund those) etc etc. having 2 people get fee's before you get to the actual source is pretty wild never heard of that seems like some sort of daisy chain. Brokers have there place no doubt but if one can get direct with the money deals go smoother and much faster.I think I may know who your partner is. I would love to buy from the actions as we do not have a lot of competition in that space in this area but they generally want to the closing to be in days vs weeks. If you are ever looking to add to in the area I would like to chat and connect and see if it makes since for you all. We do really good rehabs and want to get into new construction.
- 1yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @James Jackson:
Quote from @Jay Hinrichs:
Quote from @Jeff S.:
Legal obligation? No. But I agree that it’s an unwritten rule: you shouldn’t go around a broker, @James Jackson. As a five-time repeat customer, however, I guarantee that neither the lender nor the broker wants to lose you to their competition — which I’m sure they recognize is numerous.
I would have a strong discussion with this broker and negotiate costs and fees. (Broker liaison fee? C’mon.) I don’t know whether brokers are fiduciaries in AL as they are here in CA, but he might not be adding value for you anymore. In addition to addressing his costs, this broker should be negotiating with the lender on your behalf as well. You have every right to expect all of your suppliers to continually earn your business. This broker is no exception.
In parallel, you might find some lenders on your own. This isn’t hard, James. In fact, we don’t work with brokers at all and find our borrowers directly at local real estate clubs. Both Meetup and Eventbrite are good sources.
Here’s a meetup link to real estate clubs near Birmingham. As a proven entity, all the lenders in the room will want to get to know you. Go to lunch with a few and form some relationships. You’d be smart to build a network of lenders and keep a stable in your back pocket that you can pick and choose from as your deals, and their criteria, align.
Don’t feel stuck, James — you’re bringing them the business, not the other way around.
We are the same we don't work with brokers. And I do a ton of stuff in B ham its all direct to the clients I have there.. of course we don't advertise its all word of mouth and we are super picky on who we decide to help grow their business.. One of my current clients there I have been with since about 2005.. And have watched him work through the GFC which was exceedingly painful for both of us but we got through it and that's the extreme value of working with a a private direct lender we don't answer to those above us.. Today he has close to 300 SFRs in and around B ham is a major force at auctions ( I help fund those) etc etc. having 2 people get fee's before you get to the actual source is pretty wild never heard of that seems like some sort of daisy chain. Brokers have there place no doubt but if one can get direct with the money deals go smoother and much faster.I think I may know who your partner is. I would love to buy from the actions as we do not have a lot of competition in that space in this area but they generally want to the closing to be in days vs weeks. If you are ever looking to add to in the area I would like to chat and connect and see if it makes since for you all. We do really good rehabs and want to get into new construction.
U can send me a PM and we can chat off line to see if there is a fit at all.
- Lender · Pittsburgh, PA · Member since 2024 · 63 posts · 20 votes1y
What's going on, James - this isn't a unique scenario, so my encouragement is to not feel bad about the situation. I second a common piece of info in this thread that that there's a "pirate's code" in the broker world to not circumvent the broker to work directly with the lender, since it can damage all relationships involved.
I did hear you say that they're having you pay for an appraisal for a hard money loan though, in which case I'd say that there are likely better hard money direct lenders out there for you, ones that do not require appraisals at all.
So you could eliminate appraisal cost and broker fees in one fell swoop, or at least use it as a bargaining chip to get your existing broker to be a little more honest fee-wise. Feel free to give me a shout if it makes sense. Happy to be helpful for you.
- North East Ohio · Member since 2025 · 10 posts · 0 votes1y
Quote from @James Jackson:
Hey BP Community,
I’m in a situation with my hard money lender that I’d love some advice on.
Currently, I’ve been working through a hard money broker to secure funding for my deals. However, I’d like to work directly with the lender moving forward to streamline communication and save on broker fees.
There’s no legal agreement binding me to the broker. However, the lender is hesitant to work directly with me because they’re worried about damaging their relationship with the broker, who could potentially take business elsewhere.
Has anyone dealt with this type of situation?
-
How did you approach the lender to convince them to work directly with you?
-
Any tips for maintaining good relationships while making this transition?
-
Am I missing any ethical or reputational concerns I should be aware of?
I appreciate any thoughts or experiences you all can share.
Thanks in advance!
Most lenders will raise an eyebrow when you try to circumvent a broker partner of theirs, it may be best to try to find another lender to work with. That being said, when you are breaking down a lot of these fees in another post being charged it sounds like he's taking your shirt each deal. It sounds like you have a "bang for your buck" problem and less a dislike with brokers. Would you say that is true?
- Flipper/Rehabber · Birmingham, AL · Member since 2025 · 23 posts · 16 votes1y
Quote from @Eli Mongold:
Quote from @James Jackson:
Hey BP Community,
I’m in a situation with my hard money lender that I’d love some advice on.
Currently, I’ve been working through a hard money broker to secure funding for my deals. However, I’d like to work directly with the lender moving forward to streamline communication and save on broker fees.
There’s no legal agreement binding me to the broker. However, the lender is hesitant to work directly with me because they’re worried about damaging their relationship with the broker, who could potentially take business elsewhere.
Has anyone dealt with this type of situation?
-
How did you approach the lender to convince them to work directly with you?
-
Any tips for maintaining good relationships while making this transition?
-
Am I missing any ethical or reputational concerns I should be aware of?
I appreciate any thoughts or experiences you all can share.
Thanks in advance!
Most lenders will raise an eyebrow when you try to circumvent a broker partner of theirs, it may be best to try to find another lender to work with. That being said, when you are breaking down a lot of these fees in another post being charged it sounds like he's taking your shirt each deal. It sounds like you have a "bang for your buck" problem and less a dislike with brokers. Would you say that is true?
I 100% agree with this. The broker is a great guy do not get me wrong. Extremely smart and sharp guy. I just need to get from under the fees that I do not feel justify what is going.
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- North East Ohio · Member since 2025 · 10 posts · 0 votes1y
Quote from @James Jackson:
Quote from @Eli Mongold:
Quote from @James Jackson:
Hey BP Community,
I’m in a situation with my hard money lender that I’d love some advice on.
Currently, I’ve been working through a hard money broker to secure funding for my deals. However, I’d like to work directly with the lender moving forward to streamline communication and save on broker fees.
There’s no legal agreement binding me to the broker. However, the lender is hesitant to work directly with me because they’re worried about damaging their relationship with the broker, who could potentially take business elsewhere.
Has anyone dealt with this type of situation?
-
How did you approach the lender to convince them to work directly with you?
-
Any tips for maintaining good relationships while making this transition?
-
Am I missing any ethical or reputational concerns I should be aware of?
I appreciate any thoughts or experiences you all can share.
Thanks in advance!
Most lenders will raise an eyebrow when you try to circumvent a broker partner of theirs, it may be best to try to find another lender to work with. That being said, when you are breaking down a lot of these fees in another post being charged it sounds like he's taking your shirt each deal. It sounds like you have a "bang for your buck" problem and less a dislike with brokers. Would you say that is true?
I 100% agree with this. The broker is a great guy do not get me wrong. Extremely smart and sharp guy. I just need to get from under the fees that I do not feel justify what is going.
Do you want to hop on a quick call and discuss what you're dealing with? I am a broker myself, not trying to take the business or make the guy look bad, just offer some insight from an outside perspective?
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- 1yErik EstradaBusiness MemberLender · Member since 2022 · 6k+ posts · 1k+ votes
Quote from @James Jackson:
Hey BP Community,
I’m in a situation with my hard money lender that I’d love some advice on.
Currently, I’ve been working through a hard money broker to secure funding for my deals. However, I’d like to work directly with the lender moving forward to streamline communication and save on broker fees.
There’s no legal agreement binding me to the broker. However, the lender is hesitant to work directly with me because they’re worried about damaging their relationship with the broker, who could potentially take business elsewhere.
Has anyone dealt with this type of situation?
-
How did you approach the lender to convince them to work directly with you?
-
Any tips for maintaining good relationships while making this transition?
-
Am I missing any ethical or reputational concerns I should be aware of?
I appreciate any thoughts or experiences you all can share.
Thanks in advance!
I think the main issue here is that you do not see any value coming from your broker anymore.
Unless you are pulling in 10 deals a month as an investor, a lender will most certainly prefer to work on a brokered transaction than a one or three deal situation with an individual investor.
As a broker, we take most of the punches, the calls, the structuring, and the lender gets a clean deal without the headache of dealing with a client constantly calling them for updates, asking for pricing, etc..
Direct lenders are in the volume business. Hence why they prefer to work with high producing brokers or investors pulling in multiple flips/ rentals a year.
I can almost guarantee you that the terms you will get from a direct lender will nearly be the same, if not sometimes more expensive than working with a broker. A good broker already has a competitive advantage that most small time investors, simply will not have. They get the better terms because they send so much business to a few lenders. Better service as well.
So there really is no benefit in you going direct, unless you are literally doing 10 + units a month or millions in loan amount sizes.
If you really feel your current broker is not working in your best interests, I would recommend working with another broker. Don't get me wrong, there are some shady brokers out there, but it sounds to me that this is not the situation.
LuxePrivate Investments LLC 572 Reviews- Flipper/Rehabber · Birmingham, AL · Member since 2025 · 23 posts · 16 votes1y
@Erik Estrada I could see where you are coming from if I was a newer investor. I'm pretty much negotiating everything with the lender myself.
I am also a premium borrower with the direct lender and the broker and just renegotiated my rate down a point. I just send documents to the broker at this point.
To be clear also I'm not upset at all. I have a good relationship with the broker and lender. This is to solely build a better relationship with my current lender for some of their other products. - 1yErik EstradaBusiness MemberLender · Member since 2022 · 6k+ posts · 1k+ votes
Quote from @James Jackson:
@Erik Estrada I could see where you are coming from if I was a newer investor. I'm pretty much negotiating everything with the lender myself.
I am also a premium borrower with the direct lender and the broker and just renegotiated my rate down a point. I just send documents to the broker at this point.
To be clear also I'm not upset at all. I have a good relationship with the broker and lender. This is to solely build a better relationship with my current lender for some of their other products.So it sounds like you would benefit from working directly with a lender. At this point your broker is just collecting a fee, if there is no benefit, rate and point wise.
I would suggest having a solid conversation with your broker to voice your concerns. Of course, no broker really wants to give up their cut, so I would see if the lender can just pay a small referral fee for continuing transactions moving forward. This should help you not burn the bridge with your broker and work directly with the lender.
LuxePrivate Investments LLC 572 Reviews
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- 1yErik EstradaBusiness MemberLender · Member since 2022 · 6k+ posts · 1k+ votes
It also sounds like your deals are not penciling out? Maybe instead of focusing on lender fees, focus on the larger costs. Materials, labor, wholesaler fees, realtor fees etc.. 2-3points is really nothing when you are factoring in all of your costs.
LuxePrivate Investments LLC 572 Reviews - Lender · Roanoke, VA · Member since 2025 · 4 posts · 1 vote1y
I agree with a lot of what is being said here. All of your partners should be providing value.
I think a broker is awesome, especially when you don't yet have the direct relationships with hard money lenders. However, once you start building your own relationships, you don't "owe it" to the broker to use them for every deal unless they're continuing to provide value.
That said, I wouldn't advise you pushing your hard money lender too hard, if that would hurt their relationship with the broker.
If you are growing in volume, there's nothing wrong with building relationships with multiple hard money lenders. I see you're in Alabama. I'm happy to connect you with a hard money lender in that area that I trust.
- Flipper/Rehabber · Birmingham, AL · Member since 2025 · 23 posts · 16 votes1y
Quote from @Aaron Tsang:
I agree with a lot of what is being said here. All of your partners should be providing value.
I think a broker is awesome, especially when you don't yet have the direct relationships with hard money lenders. However, once you start building your own relationships, you don't "owe it" to the broker to use them for every deal unless they're continuing to provide value.
That said, I wouldn't advise you pushing your hard money lender too hard, if that would hurt their relationship with the broker.
If you are growing in volume, there's nothing wrong with building relationships with multiple hard money lenders. I see you're in Alabama. I'm happy to connect you with a hard money lender in that area that I trust.
I agree 100%
- Specialist · NJ · Member since 2022 · 1k+ posts · 653 votes1y
Some lenders will "protect" brokers and some do not. It's an internal policy really. If your broker has ins at a dozen lenders, can get you whatever loan program you want, a broad range of loan scenarios can be serviced, they're communicative, and are an expert at the loan process, and QB the whole thing start to finish and they only charge one point, I'd say they're worth every penny.
If they do hardly anything, are sloppy, disappear on you, and gauge you for 2 points, then I'd say yeah, not worth it.
- Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 409 votes1y
Good to see you and others move away from hard money lenders. In the past my experience with Conventus was horrendous and when I went private money it was dramatically better
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes1y
Quote from @James Jackson:
Hey BP Community,
I’m in a situation with my hard money lender that I’d love some advice on.
Currently, I’ve been working through a hard money broker to secure funding for my deals. However, I’d like to work directly with the lender moving forward to streamline communication and save on broker fees.
There’s no legal agreement binding me to the broker. However, the lender is hesitant to work directly with me because they’re worried about damaging their relationship with the broker, who could potentially take business elsewhere.
Has anyone dealt with this type of situation?
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How did you approach the lender to convince them to work directly with you?
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Any tips for maintaining good relationships while making this transition?
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Am I missing any ethical or reputational concerns I should be aware of?
I appreciate any thoughts or experiences you all can share.
Thanks in advance!
when we have someone we send them back through the broker as that relationship with the broker is worth a lot more than one deal as the brokers we work with are bringing us deals on a weekly basis. So as a lender keeping the broker happy is worth it as long as they are alos being realistic and not charging astronomical fees.
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