How Real Estate and Mortgage Brokers Can Work Together


Imagine you are getting ready to buy your first house. Your brother-in-law, who has been a homeowner for nearly five years, recommends you go see his mortgage broker. Your sister tells you to check out a particular real estate broker at the same time. She says the two worked together when she and your brother-in-law bought their house.

Is that even legal? And if so, is it ethical for mortgage and real estate brokers to work together? Absolutely, on both counts. Brokers in both industries often work together to help create the best buying experience for clients. In so doing, they strengthen their own businesses as well.

What Brokers Do

Real estate and mortgage brokers are two different types of real estate professionals with different jobs. A real estate broker is a licensed professional who owns and operates a brokerage. The broker may or may not have agents working under him. Regardless, it is the broker’s responsibility to assist clients by showing them houses, helping them write purchase offers, and generally representing their best interests during negotiations.

A mortgage broker is an independent financial professional who represents one or more lenders. Mortgage brokers sometimes represent banks, but they are more likely to represent third-party and private lenders instead. Why? Because banks have loan officers. Third-party lenders do business differently. They are more willing to work with brokers capable of bringing in business.

How Brokers Work Together

Real estate and mortgage brokers can work together in whatever ways they see fit.  CityHome Collective, a Salt Lake City real estate brokerage and design firm, says it is pretty routine for brokers to team up in the following areas:

  • Referrals – Buyer’s agents are well known for referring their clients to certain mortgage brokers. The trade-off is that mortgage brokers will refer their own customers back to the agent or real estate broker. Sending references back and forth increases leads for both.
  • Networking – Mortgage and real estate brokers offer network with one another in order to increase their volume of contacts. The more contacts each one has, the more leads they can generate. It is all about who you know in the real estate business.
  • Marketing – Both types of brokers benefit from marketing cooperation. Sometimes they will co-brand marketing materials. Other times they will actually share marketing costs. Working together can stretch a marketing budget considerably.
  • Education – Real estate and mortgage brokers often team up to educate consumers about the home buying process. They teach consumers about things like loan pre-approval, saving for a down payment, making offers, etc.
  • Service – The strongest mortgage and real estate broker relationships extend as far as servicing clients. For example, a mortgage broker might make himself available to answer questions during the home search phase. If a question comes up the listing agent cannot answer, she contacts the mortgage broker.

A Better Way to Do Business

It is obviously not necessary for real estate brokers or listing agents to work with mortgage brokers. Likewise, mortgage brokers can steer completely clear of their real estate counterparts. However, you would probably have no problem finding real estate agents and mortgage brokers who consider working together a wise idea. It is just a better way to do business.

The process of buying a home is multifaceted. Buyers look at listings. They view properties and make offers. Ultimately, the entire transaction hinges on whether or not the buyer can get a mortgage. This indicates that brokers do better if they work together to ensure a buyer actually completes his or her purchase.