To support their operations, a mortgage bank acquires a certain amount of equity, which is then used to secure the warehouse line.
Many mortgage banks employ specialty servicers for tasks such as repurchase and fraud discovery work.
By selling them shortly after they are closed and funded, they are eligible to earn a "service released premium".
Many do not take deposits from customers and call themselves Mortgage Lenders, to avoid being confused with a typical bank.
Mortgage brokers, on the other hand, earning the same yield spread premium, disclose the additional fee to the consumer because the yield spread premium becomes an additional fee earned and therefore disclosable under federal and state law.