"But we have already established that you are minnow, and the bank is not going to bend over to maintain a good relationship with a dinky bottom-feeder broker."
The broker may be a minnow but he is able to facilitate a deal by putting a loan package in front of competing whales ie the big 4 banks plus other wholesale lenders .
Yes the broker is a middleman by charging ets say 100 points (1 % ) of the loan value to a customer but if he can get more than 1% by saving by going through the wholesale arm of the bank rather than the retail arm then the customer wins and in this case there is also the advantage that not all lenders have the same requirements , and the broker Malaz would have been able to find a lender who would accept a smaller apartment as security on the loan .
(The points charged is also dependent on the term of the loan in years and other factors ie doc fee , )
I was a loan officer for a couple of years in California back in 1998/1999
