A bank sells you its own loan. A broker goes shopping.
The structure
A retail bank originates loans it will fund itself. It has one product menu, one set of guidelines, and one underwriting department. If your file does not fit that box, the answer is no, and you start the whole process again somewhere else.
A mortgage broker does not lend money. Hughes Mortgage is licensed under the California Financing Law as a broker, which means I take your file to wholesale lenders who compete for it and place it with the one whose guidelines and pricing actually fit.
The practical difference shows up in the files that are not straightforward. Self employed income. A recent job change. A non warrantable condominium project. An investment property held in an LLC. Every one of those is a placement problem, and placement is the entire job.
Where the pricing advantage comes from
Wholesale is a different channel than retail. When a lender originates directly to a consumer, the cost of the branch, the retail loan officer, and the marketing that produced that customer is carried on the loan. When the same lender takes a file from a broker, that cost structure is not there.
That does not automatically make every broker loan cheaper than every bank loan. It means the wholesale channel starts from a lower cost basis, and that comparing several wholesale lenders on the same file is more likely to produce a better result than accepting one retail quote.
When a broker is not the answer
If you have a long standing relationship with a credit union offering a portfolio product with terms nobody in the wholesale channel matches, take it. If your bank is offering a meaningful relationship discount tied to assets you already hold there, that is real money and it should be weighed.
I would rather tell you that up front than spend three weeks arriving at it. Compare the offers. If mine is not better, take the other one.
What I do not do
I do not approve loans, and neither does any broker. Approval authority sits with the wholesale lender's underwriting department, measured against that lender's guidelines. My job is to know which lender is going to say yes before we spend three weeks finding out, and to run the file cleanly enough that the answer comes back fast.
Common questions
Does using a mortgage broker cost more than going to a bank?
Not inherently. Wholesale pricing available to brokers is generally lower than the retail pricing the same lender offers directly, because the lender is not carrying the cost of a retail branch network on that loan. Broker compensation is disclosed on every file. The relevant comparison is the total cost of the loan, not who originated it.
Does a broker approve my loan?
No. A broker does not lend money and does not underwrite. Approval authority sits with the wholesale lender, whose underwriters review the file against their guidelines. The broker prepares and places the file, and manages it through the lender process.
Will applying with a broker hurt my credit more than applying with a bank?
No. Mortgage credit inquiries made within a defined shopping window are treated as a single inquiry by the scoring models, which exists specifically so that comparing lenders does not penalize you. A broker shops multiple lenders from one credit pull, so the number of lenders considered does not multiply the credit impact.
Start with a quick call
Tell me what you're trying to buy and roughly where your income and credit stand. In about fifteen minutes we'll both know whether there's a loan here and what it would take.