Mortgage Broker and Mortgage Banker

When you're looking to get a mortgage , you need to know the difference between a loan officer and a mortgage broker. Since both a mortgage broker and mortgage banker will help you fund a new home, it's understandable to confuse them. However, it is important to recognize the difference between them so you know what to expect from them during the mortgage process.

About Mortgage Brokers

A mortgage broker is a person or firm that acts as an independent agent for the mortgage loan applicant as well as the lender. Your mortgage broker will stand as coordinator between you and the lending institution; which can be a credit union, bank, trust company, finance company, mortgage corporation or even an individual, private investor. Which lender has the loan programs that is right for you? A mortgage broker will guide you to the best fit. You deliver your mortgage loan application to your broker, who presents it to one or more lenders. Your mortgage broker then helps you work with the lender of choice until the loan closes. The broker is given a commission from the borrower when the loan closes.

About Loan Officers

Lending Institutions (banks, finance companies, and others) employ loan officers to offer, and process loans originated by that particular institution alone. While a mortgage banker may promote quite a range of loan programs, they are all products from that lender alone.

A loan officer (also called an "account executive" or "loan representative") acts on behalf of the borrower to the lending institution. The borrower is helped through the whole process, from loan selection to closing, by the loan officer. Mortgage bankers are paid a commission or salary for their services by their employers.

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