Mortgage broker

Mortgage brokers are specialized in the credit brokerage of real estate financing companies or individuals. Here, they do not occur even as the lender on, but convey a third mortgage lender to finance a property to the borrower. For the lenders, it may be banks, building societies or insurance companies. Borrowers are usually consumer or real estate companies.

Business Model

The mortgage broker compares with the help of databases for the potential borrower the offers from many banks.

If there is to enter into a loan agreement with one of these banks, the mortgage broker receives from the lender for a successful placement commission of standard 1 percent of the loan amount. The commission varies between lenders. The commission does not have to pay in addition to the borrower. It is already included in the interest rate of the loan.

The borrower saves itself by the use of a mortgage broker comparing the loan offers from many banks. Unlike traditional bank sales of in-house loans mortgage brokers offer a wider variety of products. Despite the fact that the credit terms the commission for the mortgage broker is included, the credit rule is not more expensive - often even cheaper - than directly by the lender. Due to the different commissions, it is nevertheless useful to compare the offers of several mortgage brokers together to ensure that you get the cheapest offer of credit as borrower.

Historical development

With Sonnenblick - Goldman, the first mortgage broker was founded in 1893 in New York City. Sonnenblick - Goldman specialized in arranging loans for complex, commercial real estate projects. In the course due to the demand for real estate and real estate financing is located in the development of the western United States, a variety of local mortgage brokers emerged. These combined loans from banks and private investors to provide financing, which were rejected by banks alone.

After the Great Depression occurred in the United States to a highly regulated mortgage market. Mortgage Bankers took over the financing of large real estate projects on state programs, savings banks ( American " Savings and Loan Banks " ) the local housing financing and mortgage brokers were responsible for the rest. With the deregulation of American banks and mortgage market before and in consequence of the Savings -and -loan crisis, many former sales representatives of savings banks to independent mortgage brokers.

In the other Anglo-Saxon countries originated mortgage brokers in the 1970 (UK ) or 1980 (Australia ) years. In 1979 there was the first regulation of the activities of mortgage brokers in California. In the 90's they gained a dominant importance in these markets.

In Germany, there were up to the 90s only a few regional specialized mortgage brokers. With the proliferation of the Internet and through the acquisition of American e-business business models came from 1990 to the creation of numerous Internet-based mortgage broker in Germany, Italy and France. 2012 had mortgage brokers in Germany with a market share in the sale of real estate loans of approximately 20-30 percent.

For the triggered as a result of the collapse of the U.S. sub-prime market financial crisis in 2007, in addition to the financing banks and government institutions are regularly made and American mortgage broker with responsibility.

Legal framework

Situation in the European Union

Basically subject in the European Union, the mortgage brokers in arranging loans to consumers the terms of the Consumer Credit Directive. This is supplemented by country-specific laws for credit intermediaries in general and mortgage brokers in particular. Due to the special requirements for the provision of mortgage loans and so far very different rules in different Member States, the EU has consistently revised on 10 December 2013, the Mortgage Directive legal framework for the activities of mortgage brokers in Europe.

Situation in Germany

In Germany, mortgage brokers must each satisfy the same conditions as general credit intermediary in the credit intermediation to consumers and businesses. So far, the job of the mortgage broker in Germany is not regulated by law. The academy of the real estate industry offers training to "Approved / r mortgage broker / in (FMA ) ".

Situation in Austria

In Austria, the staff credit intermediary may only loans that are not secured by mortgages convey. The activity of a mortgage broker falls into the profession of real estate agent. Only real estate broker may provide mortgage loans.