There's only one thing people need to know about mortgage brokers: They have no legally mandated fiduciary duty to the borrower. They are salespersons, no more, no less. Ethical brokers will get you the best rate you qualify for. Unethical brokers will sell you the most expensive loan they think they can get you to sign.

Not defending the practice but anybody who does not do some shopping on rates deserves what they get. Like anything else comparative bidding is worth the effort.

One way to stop the practice by the lenders is for the mortgage buyer to ask for a copy of ALL the lending offers they would qualify for. If the broker won't do that walk out the door.

Happens on car loans, too. Not sure if its part of the advice given in previous 'How to buy a car' stuff (as part of the 'don't finance through the dealer' bit).

My wife's van died recently while we were on vacation so we picked up a new used car. A few weeks later, the denial letters started arriving (we don't have stellar credit- its a work in progress :p) and one of them said the bank made a counter offer.

The bank said they couldn't give the rate info to us since the app was done through the dealer (confirmation, anyone?) and that most consumers don't know to ask to see all offers.

I recall no disclosure that we might not be getting the best rate offered.

@JohnMc: Deserves what they get? Victim bashing much. Come off it. Does anyone deserve it? Sure you might not feel sorry for people who aren't intelligent enough to not get suckered in by the sleezy, but to say they deserve to get suckered in? Damn!

When we in the market for a home 3 years ago, I actually had a mortgage broker call me 'dumb' and 'stupid' because I wouldn't take his lousy offer of a (high rate) interest-only loan. Before I told him to f* off, I politely informed him that this was the best for him to own a house, not me. He just didn't get it. No doubt he was getting some sort of juice to put lipstick on that pig of a loan.

How is this any different than stock brokers pushing garbage stocks, and getting free courtside tickets for it?

@hypnotik_jello: Victim Bashing is a core competency of many of the forum participants here. Now we need to start working on bashing the victim bashers.

@Alger: I'll get right on that.

"Not to defend the victims or anything, but anyone who doesn't do some research about what kind of site he's visiting deserves to be annoyed by people who think they've been wronged. It's your own fault for looking! You represent everything that's wrong with America these days and you're probably fat, too."