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Comment by nostromo | Hacker News Reader

I saved a lot of money using a broker.

I'm actually not sure why people go directly to banks -- brokers are there to do all the work for you and to save you money.

The key to mortgage brokers is using several. Contact two or three and see which one finds the bank with the best deal.

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As a counterpoint, I'm not sure why anyone would use a broker when it is clear they also need to get paid; and you can call a dozen banks to get their interest rates for whatever kind of loan you're trying to get yourself. When you're talking about hundreds of thousands of dollars (or maybe even over a million), doing a bit of work yourself seems like a good idea.

Well, in theory the broker is getting paid by the lender, not by me (the borrower). Of course, we all know that in a rational market, that cost has to be passed on to me. And yet strangely, I get a better offer when I ask the broker than when I straight up tell the bank "I'm going to go to a broker now, and so this is your last chance to beat whatever offer they're going to give me".

Conclusion: lenders are irrational. Surprise!

I suspect that this has something to do with the fact that a portion of the administrative work is offloaded to the broker.

I never met anyone from the lender when I got my mortgage. All of the background investigation, income/employment verification and paperwork was completed with the broker.

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