Why Are So Many Investors Avoiding Brokers Lately?

[Deborah Wodell]

I’ve noticed more investors saying they want to go “direct to lenders” instead of working with brokers. I totally get that no one wants extra fees or middlemen, but I’m curious about your experiences and thoughts on this.

For those who’ve gone direct, did it actually make things easier or cheaper for you? Or did you find that having a broker helped you get better terms or faster results? From what I’ve seen, brokers can often access multiple lenders at once and find creative ways to get a deal done that a single lender might not. But I also know some people have had bad experiences with brokers who didn’t communicate well or didn’t add much value.

I’m just interested to hear from both sides, investors, lenders, and brokers....... what makes you prefer one route over the other?

[Clayton Silva]

I have worked for both a brokerage and an IMB.  I prefer the IMB model infinitely more.  More control, better communication, more exceptions approved, better staffing, and comparable or better pricing on rates and loans.  More options too (not true for all IMBs but at least where we are at, it is so much better).  IMB is great too because we can still broker loans if we are unable to fund the specific deal in house.  

Direct banks like WF, JPM, etc. tend to have best rates and pricing but extremely tight buy boxes so unless the client is a perfect fit, they just deny a lot of people and have very few options.