American Pacific Mortgage

American Pacific Mortgage

Tuesday, June 11, 2024

JUNE GLOOM - Brokers and Bankers Explained


Those of us living in Coastal Southern California are currently experiencing unfortunate but traditional June Gloom.  Many days the sun barely appears and drizzle is apparent almost every morning.

However, the housing market is not nearly as gloomy.  Although interest rates remain stubbornly high, mostly in the 7+ range, this is certainly not deterring buyers from the market any longer.  Prices are up – as much as 18% over the last year, depending where you are….  The Median Home price in Orange County is $1.2M.  There is competition for homes.  If you want to sell, this is a great time to do so.

What is driving those prices sky high you ask, again?  Lack of Inventory!  Simple supply and demand equation.

Things may look a bit different in other parts of the country, as Real Estate values are definitely location driven and quite specific to neighborhoods.


American Pacific Mortgage is a Mortgage Banker.  That means that we process, underwrite and fund our own loans, in-house with our employees.  This process provides far more control to loan officers since we can manage the process more efficiently.  “Julie, can we please put a rush on this file so we can close timely?”

In this fashion we fund our loans using a “warehouse line” which is similar to a super large Line of Credit.  Once the loans have been funded, we then sell them to one of a number of different places:  Fannie Mae, Freddie Mac, the VA, and a host of other individual investors like banks and large mortgage companies.  We do not service our loans nor hold them in our “portfolio.”  All loans are sold once closed, to a third party.

Brokers typically send loan files off to a third party to process, underwrite and fund the loans.  The broker is paid a fee which is disclosed on the Initial and final Disclosures.  We sometimes send our loans out to other investors “brokering” the loan to them for better pricing.  It is always our goal to find the best loan program and interest rate for our clients.  However, there is a loss of control with brokered loans as the process is managed outside our own company.

Please reach out to us with questions or for advice!  We are here to help!

Karen, Katie and Stephanie

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