New Independent Study: Consumers Pay Lower Annual Percentage Rates
with Mortgage Brokers, Not Mortgage Lenders
April 7, 2005 - Dr. Gregory Elliehausen of the Georgetown University Credit
Research Center today presented findings to a Federal Reserve Board Conference.
The report stated that brokers’ customers have a lower APR, on average, than
bank customers.
The conclusions of the report are:
Estimates indicate that borrowers
obtaining subprime mortgages through brokers paid lower annual percentage
rates than borrowers obtaining subprime mortgages from creditors.
The results support the hypothesis that through
competition, brokers tend to pass their origination cost advantages
to the consumer.
The results challenge the view that loans from
brokers are more expensive because of broker steering.
Although the report’s findings will not apply
to every individual case, there is an overall price benefit to using
brokers.
The benefits of brokers also appear to hold for
vulnerable market segments.
Licensed Mortgage Banker, NJ
Dept of Banking & Insurance | Licensed Mortgage Broker, PA Dept of Banking & Insurance
Licensed Mortgage Broker, ME Dept of Banking & Insurance
Pioneer Finance and Mortgage - 28 Center Street Suite #3 - Clinton, NJ 08809 | Phone
908.730.7988
