Mortgage Broker vs. Mortgage Banker

Either a mortgage broker or a loan officer may assist you when it comes to locating a mortgage loan. Because a new home is the result of the work of both mortgage broker and loan officer, people can confuse them. Yet it will be important to know the difference between the two jobs so you have clear expectations of them as you enter your mortgage application process.

About 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 facilitates 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 a private 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. A mortgage broker can analyze your finances to find out which lender is the right fit for you. Your broker will submit your mortgage loan application to a handful of lenders, and works with the chosen lender until closing. The borrower submits a commission to the broker upon closing.

What is a Mortgage Banker?

Loan officers represent a specific lending institution (such as a bank, credit union, etc.) who process mortgages and other loan products originated by their employer alone. There can be a wide variety of loans types to choose from even though all are programs of that particular lender.

A loan officer (also called an "account executive" or "loan representative") represents the borrower to the lending institution. The borrower is helped through the entire process, from loan selection to closing, by the loan officer. Loan officers are paid a commission or salary for their work by their employers.

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