Mortgage Broker or Loan Officer

When you need a mortgage , you may work with a loan officer or you may choose to work with a mortgage broker. As both a mortgage broker and mortgage banker can help you fund a new home, it's understandable to confuse the two. Yet it will be valuable to recognize the difference between them so you know what to expect from them as you enter the mortgage application process.

What is a Mortgage Broker?

During the mortgage loan process, an individual or group who is an independent agent for both mortgage loan borrower and lender is a mortgage broker. Your mortgage broker will stand as coordinator between you and the lending institution; which may be a credit union, bank, trust company, finance company, mortgage corporation or even an individual investor. Which lender has the loan programs that is best for you? A mortgage broker will help you find the right fit. You give your loan application to your broker, who presents it to a number of lenders. Your mortgage broker then guides your work with the lender of choice until the loan closes. The borrower gives a commission to the broker when the loan closes.

Mortgage Bankers

Loan officers represent a specific lending institution (such as a bank, credit union, etc.) who process mortgages and other loans from their employer alone. Although a mortgage banker may offer quite a variety of loans, they all are products of that lender alone.

A mortgage banker (also called an "account executive" or "loan representative") acts on behalf of the borrower to the lender. The borrower is helped through the entire process, from choosing a loan to closing, by the mortgage banker. Mortgage bankers are compensated with a commission or salary for their work by their employers.

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