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Upfront Mortgage Broker™

When you are in need of a mortgage loan, most independent mortgage experts advise consumers to select a mortgage broker and not a mortgage lender. And now there is a new type of mortgage broker that provides consumers with significant benefits over a typical mortgage broker- an Upfront Mortgage Brokerâ(UMB).

A UMB is a mortgage broker that has elected to do business in an upfront and fully transparent way and operates under specific guidelines (The Upfront Broker Commitment). Kevin Iverson, President and owner of Reed Mortgage Corporation, was the first mortgage broker in the USA to receive the UMB designation .

The UMB concept was conceived by Jack Guttentag, the nationally syndicated columnist and well-known expert on mortgage loans. Guttentag developed the idea as a result of his experience as a mortgage adviser to consumers. His website contains information on UMBs and other mortgage related topics and can be found at 

The major differences between a UMB and a conventional mortgage broker (CMB) are as follows: 

  • A UMB provides a service to the borrower as the borrower's agent.

A CMB is a loan provider who may or may not represent the borrower.

  • A UMB discloses in advance its fee to its customers, and reveals the wholesale price (rates and points) it receives from its lenders.  Customers pay the broker's fee and receive wholesale loan prices.

A CMB does not quote a fee for their services but adds a markup to the wholesale loan prices received from lenders.  The loan prices quoted to customers include the markup.

  • A UMB credits customers with any rebates it receives from lenders, or any concessions it receives from home sellers.

A CMB may or may not credit customers for payments from third parties, depending on negotiations between the parties.

  • The UMB's interests are fully aligned with those of its customers.

CMBs are often in a conflict situation with customers, for example:

§        The loan type that best meets the customer's needs may not be the one that allows the largest markup for the CMB. 

§        CMBs may profit by ignoring customer requests to lock the rate/points, putting the customer at risk.

§        CMBs often increase their markup on customers who allow the rate/points to float by not giving them the best available rate (the float rate) when the loan is finally locked. 


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