Mortgage Broker or Loan Officer

When you need a mortgage loan, you should know the difference between a mortgage broker and a mortgage banker. People can confuse the two job types as both will produce the same result: a new home. However, it is valuable to know how they differ so you know what to expect from them as you enter your 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 applicant and lender is a mortgage broker. A mortgage broker coordinates things for you and your lender, which can be one of the following: a bank, trust company, credit union, mortgage corporation, finance company or even an individual investor. Acting as a facilitator between you and your lender, your mortgage broker can match you with a credit union, bank, trust company, finance company, mortgage corporation or even a private investor. Which lender offers the loan programs that fits your needs? A mortgage broker will guide you to the right one. You give your application to your broker, who presents it to several lenders. Your mortgage broker then helps you work with the lender chosen until closing. The broker gets a commission from the borrower when the loan closes.

About Loan Officers

Lending Institutions (banks, finance companies, and others) employ mortgage bankers to offer, and process mortgage loans solely originated by that particular institution. Although a loan officer may promote quite a range of loan programs, they will be products of that one lender.

Your mortgage banker represents you to the bank or other lending institution. The borrower is walked through the entire process, from loan selection to closing, by the loan officer. Lenders compensate the mortgage bankers with a commission or salary.

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