A mortgage broker is a match maker between a borrower who is interested in seeking loan and a lender, ie, bank or financial institution. The broker draws from a pool of various lenders to find the right match for the borrower.

Mortgage brokers came about out of a borrower’s need to obtain information and knowledge on how to obtain a loan and the lenders’ need to expand their reach to the consumers in the most cost effective manner.

A borrower usually offers his property as security for the loan and in most circumstances, the loan is required to finance the purchase by the borrower of the property offered for security, though not necessarily so.

Many homebuyers are not familiar with the process of obtaining loan and often become frustrated with the bureaucracy associated with buying a property and seeking a loan to finance the purchase of that property. There are real estate agents to deal with, lawyers to negotiate terms and conditions of the purchase, management company and/or local authorities to liaise with and, of course, the lenders for the all important loan to finance the purchase of the property. For financing, the questions arise as to which lender and which loan package suits them best. Shopping for the most suitable loan package can be tough and time consuming as the lenders’ officers normally restrict their advice to loan packages that is available from their own range of products. This results in more confusion in the mind of a homebuyer, especially when each of the lenders’ officers would claim that his loan package is the best.