While tighter federal regulations on mortgage brokers have urged many to change their focus to correspondent lending, Chad Wade, owner of Cornerstone Mortgage Group in Sandy Springs, said he has seen an upswing in brokers recently.

“The business is picking back up,” he said. “I’ve got people calling wanting to work for us. Now that everyone has kind of seen this thing through, they want to be able to offer more products. It’s cyclical.”

After the housing market crashed beginning in 2007, Wade said there was a lot of legislation passed that affected mortgage brokers more so than lenders.

“Somebody had to be the fall guy,” he said.

The main difference between brokers and lenders is brokers just find investors or lenders, whereas correspondent lenders fund the loan with their money, underwrite the loan and sell the loan themselves, according to George Beylouney, branch manager of Silverton Mortgage Specialists near Vinings.

According to Beylouney, about five years ago, brokers accounted for about 50 percent of the market. Today they make up only about 5 to 10 percent, he said.

While using a correspondent lender is a more competitive approach than going straight to a bank for a loan, Wade said brokers are able to get the most options in terms of investors. This is what has led to tighter regulation, though, said Wade.

“The negative part is, from a competitive standpoint, the amount of options is going to be more limited,” said Beylouney.

Beylouney said about 70 percent of the market was controlled by the big banks.

“That’s where it gets dangerous,” he said.

“The government is afraid of fraud — if I get someone who isn’t approved for a loan, I’ll go to someone else,” he said. “In the grand scheme of things, I’d like to be able to see the market control itself. If brokers are doing that, then the public would shift toward correspondent lenders, not the government regulating one group out of business.”