Mortgage Broker or Loan Officer

When you apply for a mortgage , you may work with a loan officer or you may choose to work with a mortgage broker. As a new home is the result of the work of both mortgage broker and mortgage banker, it's common to confuse the two job types. Yet it is beneficial to understand the difference between the two jobs so you know what to expect from them as you enter the mortgage application process.

Mortgage Brokers

A mortgage broker (either a firm or an individual) is an independent agent for both the mortgage loan applicant and the lender. A mortgage broker coordinates things for you and your lender, which can be one of the following: a credit union, bank, trust company, finance company, mortgage corporation or even an individual investor. Acting as a facilitator between you and your lender, your mortgage broker can match you with a bank, trust company, credit union, mortgage corporation, finance company or even a private investor. You partner with a mortgage broker to analyze your financial circumstance and find the lender who has the right loan for you. Your broker will present your mortgage loan application to one or more lenders, and works with the chosen lender until the loan closes. The borrower pays a commission to the broker at closing.

What is a Mortgage Banker?

Lending Institutions (banks, finance companies, and others) employ loan officers to offer, and process mortgage loans solely from that specific institution. Although a mortgage banker may promote quite a range of loan programs, they will be programs of that one lender.

Also called a "loan representative" or "account executive," a mortgage banker represents the borrower to the lending institution. From choosing a loan product to closing, a mortgage banker can walk the borrower through the process. Loan officers may be compensated with a commission or salary for their services by their employers.

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