When it comes to real estate, there are so many different professions. You may not even realize it, but there are.
When we think or talk about real estate, the main topic would be the real estate agents. After all, often the only contact people have with real estate is when they meet with an agent to talk about selling, buying, or leasing a property.
Real estate agents’ job description can vary – a lot. Many agents tend to do as much as they can themselves, so they can earn more money.
To be fair, real estate can be a very lucrative field of work. But to truly earn money, they have to save up on everything they can.
For example, many realtors choose to work from home, or independently. Why so? Because the desk fee can be a hefty one.
So, there are many other jobs the real estate agent can take upon themselves. So, what about mortgage brokers?
Can the real estate agent work as a mortgage broker, too? Continue reading to find out!
What Does A Real Estate Agent Exactly Do?
A real estate agent works with clients to help them buy, rent, and sell properties. They have exclusive knowledge about the current real estate market and conditions.
They can give you advice on the ideal moment when buying or selling a property. They can guide you through the whole process of buying or selling a property and be of assistance when you’re figuring out what kind of property you need.
If you’re a first-time buyer or seller, you could certainly benefit from the advice given by a realtor. They can walk you through the whole process, step by step.
There are two basic types of real estate agents – residential and commercial. For both, you need a license to start working. Residential real estate agents work with residential properties.
Those properties would be houses, apartments, and such. On the other hand, commercial real estate agents work with properties for commercial purposes.
Commercial buildings and other types of commercial properties are used for offices, various businesses, and so on. Both fields can be lucrative, but many agents choose to work with only one.
The reason behind that is that it’s a completely different market. Changes in the residential real estate market can have little to no effect on the commercial property market, and vice versa.
Because of that, it can be rather hard to keep track of both. And one more thing – a real estate agent tends to have more success when they specify in one field only.
A real estate agent can work for a brokerage, or they can work independently, as we already mentioned. Besides a hefty desk fee, what are other reasons a real estate agent would decide to work from home?
Well, cutting travel expenses, along with the desk fee, can make a huge change in the earnings department. Flexible work hours and better organization are just a plus.
The only flaw when a realtor is working from home is losing the walk-in clients. Agents who work for a brokerage get a good number of those when they’re just sitting at their desk in the office.
What Does A Mortgage Broker Exactly Do?
Mortgage brokers work as middlemen between a property buying person and a lender – a bank or a financial institution.
Mortgage brokers give you information about your loan options. They calculate the loan options based on the financial information about the client – salary and passive income and so on, their credit score, and previous history of loans.
For example, the smallest mortgage rates are given to people with exceptional credit scores, who paid their debts in time. Those who had to pay a late fee from time to time would have to expect to get a much larger mortgage rate.
A mortgage broker will present the prospective homeowner with several loan options from several institutions. A buyer can get a better idea of them once they see what the overall idea is.
Mortgage brokers also have two basic fields they specify in: residential and commercial real estate. Those brokers who work with residential mortgages, work with people to help them acquire a new property.
On the other hand, commercial mortgage brokers work with various businesses and companies. They work with them to help them get a loan for a new office building, for example.
They also have to complete a lot of loan paperwork, once they get an official offer from a financial institution.
Now, let’s talk about their job description. They have to gather a lot of documents, credit history info, and verification of employment for those seeking a loan. Also, they have to use all those documents to apply for loans with financial institutions.
A mortgage broker has to establish a professional relationship with many lenders. It’s a mutually beneficial relationship – they have lenders on hand, and the lenders benefit from getting new clients.
Mortgage brokers have to be licensed and educated for this job. A mortgage broker has to advise their clients and explain all the clauses, especially if the client is applying for their first loan. And one more thing – the broker has to make sure that the client isn’t breaking any laws when applying for a loan.
Can a real estate agent also be a loan officer? Read our article to find out!
Can A Real Estate Agent Work As A Mortgage Broker?
So, can they? Yes, a real estate agent can work as a mortgage broker as well.
Most states here in the US are in demand for people who work as loan intermediaries and real estate agents. While it’s completely legal to work with both, there are some legal boundaries set, and we’ll cover that topic as well.
When some person or company is trying to sell their property, they tend to look for a realtor that is operating as a loan officer, as well. Why so?
Keeping in mind the benefits for the person working as both, there are benefits to clients, as well. So, it’s more convenient for the client/seller to work with such a realtor because the whole process will go much faster.
Also, for a potential buyer, this could be a plus. No need to schedule an appointment with a mortgage broker, too – your realtor can do it all.
However, there are a few obstacles for realtors who operate as loan officers, too. First, they cannot originate FHA loans if it’s for their clients. They can do it only if they’re originating for someone else’s client.
They can originate regular loans, portfolio and jumbo loans, and even commercial loans. Realtors can do all that for their clients, just not FHA loans.
|Conventional loans||The credit score has to be minimally 640Down payment at least 3%With 20% down, mortgage insurance is not required|
|Jumbo loans||No mortgage insuranceDown payment of at least 20%The minimall credit score is 700|
|Portfolio loans||Low credit requirementsNo mortgage insuranceNo down payment|
|Commercial loans||5% down paymentNo mortgage insurance660 minimal credit score|
When the mortgage broker is not also a real estate agent for a client, they can issue an FHA, VA, and USDA loan. When they’re working both of their licenses for a client, they cannot issue those loans.
VA, FHA, and USDA – what’s the difference?
|VA loan||No mortgage insurance620 minimal credit scoreNo money down|
|FHA loan||Mortgage insurance580 minimal credit score3.5% of the credit is a down payment|
|USDA loan||Mortgage insurance600 minimal credit scoreNo money down|
If you need a Mai appraisal, read our article to find out more about it
Can A Real Estate Agent Work As A Mortgage Broker – Conclusion
To conclude, a real estate agent can work as a mortgage broker, too. There are a few legal obstacles, but all in all, it can be done.
The jobs may be essentially very different – one working with clients that are buying or selling, and the other originating loans for those clients. So, the jobs are different but connected, no surprise that there are so many people with a dual license!
Some people selling property are looking exclusively for a real estate agent that can also originate a loan for the potential buyer. This makes the whole process faster, and therefore the seller can get the money earlier.
It can be lucrative to work in both fields, and it’s convenient for the buyers, too. No need to look for a good loan officer and schedule a meeting, all you need is talk with your realtor!
There are a few legal obstacles, though. A realtor cannot issue an FHA loan for their client, but they can issue it for anyone else! For their real estate clients, they can issue commercial, jumbo, portfolio, and conventional loans!
If you’re looking to work in both fields, we salute you! It can be a great way to earn more money and do something different! All you need is to acquire a license and fulfill a few courses – and you can be a loan officer, too!