broker origination

A loan that is originated under circumstances where a person or firm other than a mortgage loan seller (or its parent company, controlled affiliate, or subsidiary) or lender correspondent is acting as a “broker” and receives a commission for bringing together a borrower and a lender. The broker performs some of the loan processing functions (such as taking loan applications; ordering credit reports and title reports; requesting appraisals; and verifying a borrower’s income and employment), but does not underwrite the loan, fund the loan at settlement, or service the loan. Typically, the loan is closed in the name of the mortgage loan seller or lender correspondent that commissioned the broker’s services, but may also include so-called “table-funded” loans where the loan is closed in the broker’s name, but is funded by the mortgage loan seller or the lender correspondent.