Sprout Mortgage, which bills itself as a leading provider of nonconforming loans, says it’s giving mortgage brokers more control over how lender fees are presented to consumers in the loan estimate.

“It’s time to rethink the loan estimate,” said Sprout EVP and Chief Operating Officer, Nicholas Imbimbo, in a statement. “The launch of our advanced fee management mechanism eliminates process steps and provides much greater visibility into what borrowers will see related to lender fees.”

Once they’ve received a loan application, mortgage lenders have just three days to provide consumers with a loan estimate. In addition to the interest rate and principal and interest payments, the loan estimate details a laundry list of additional costs. These include lender fees such as origination charges, discount points and underwriting fees, which can’t increase unless there’s a change in the borrower’s circumstances.

Mortgage brokers have the option of earning a percentage of the loan amount directly from the lender, or they can charge clients an origination fee up front. Borrowers often prefer that the mortgage broker be paid by the lender, but they may end up with a higher interest rate if they go that route.

Sprout says the new fee management tool that it’s making available on April 1 is part of a larger initiative, Broker AdvantEDGE, aimed at helping brokers “enhance the borrower experience and expand their business.”

The wholesale mortgage lender expects the fee management tool will increase accuracy by allowing brokers to control data input, access compliance results prior to loan submission, fill out fewer forms and worksheets, and preview loan estimates before submitting loans for disclosure.

As a “non QM lender” Sprout buys mortgages originated by brokers that meet the requirements of its loan programs. These requirements can be more flexible than Fannie Mae and Freddie Mac’s.

Sprout’s alternative qualification loan programs, for example, can make it easier for investors or self-employed borrowers with credit scores of at least 660 to take out or refinance a mortgage on a primary residence, second home or investment property. The company also finances jumbo loans and mortgages for investors in residential and mixed-use properties.

Email Matt Carter

mortgages | technology
Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Real estate news and analysis that gives you the inside track. Subscribe to Inman Select for 50% off.SUBSCRIBE NOW×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription