The mortgage crisis has clobbered the market share of the biggest lenders in the country, and that could be a good thing.


When Dinosaurs Ruled the Earth

As recently as 2010, the country’s five largest mortgage lenders controlled a whopping 2/3 of the market, according to Inside Mortgage Finance, and borrowers who didn’t drop neatly into their little boxes were largely out of luck. That went double for those who were underwater and needed the HARP program to refinance.

So much business concentrated in the hands of a few huge companies also had a chilling effect on competition for your business. This became apparent when industry analysts discovered that lender profit margins were unusually high, and they concluded that mortgage rates did not come down as much as they could have because lenders were operating at capacity with no incentive to reduce prices.

2012 was the Year of the Little Guy

By 2012, however, the behemoths had lost market share, only controlling about 53 percent of the business, and forecasters predict that it could shrink to just 40 percent in the coming years.

The rise of smaller lenders is good luck for consumers. They claim that their lower costs and faster processing times have allowed them to price mortgages more advantageously than the bigger banks.

But How Do You Find the Best Little Lenders?

These lenders don’t have ATMs on every corner, and you won’t find football stadiums named after them. They didn’t run any gee-whiz commercials during the Super Bowl. You can, however, find them at LendingTree, taking it to the big guys and putting their best pricing out there for you.

If you’re the type of person who roots for the little guy (or if you just like saving money!), try LendingTree’s free service and give these minute mortgage pros a shot at earning your business.