Mortgage Broker or Loan Officer

Either a mortgage broker or a loan officer may help you when you work on your application for a mortgage loan. Since both a mortgage broker and mortgage banker will help you fund your new home, it's common to confuse them. Yet it will be helpful to know the difference between them so you have clear expectations of them during your mortgage application process.

Mortgage Brokers

A mortgage broker (either a firm or an individual) is an independent agent for both the mortgage loan borrower and the lender. Your mortgage broker will stand as facilitator between you and the lending institution; which may be a bank, trust company, credit union, mortgage corporation, finance company or even a private investor. A mortgage broker can look at your financial situation to determine which lender is the right fit for you. Your broker will present your mortgage loan application to one or more lenders, and works with the lender of choice until the loan closes. The borrower submits a commission to the broker upon closing.

About Loan Officers

The biggest difference between a mortgage broker and a loan officer is that the latter works on behalf of a lending institution (a bank, credit union, or others) to process loans only from the programs of that institution. Although a mortgage banker may offer quite a variety of loans, they are all programs with that lender alone.

A mortgage banker (also known as an "account executive" or "loan representative") represents the borrower to the lender. The borrower is walked through the whole process, from loan selection to closing, by the loan officer. Mortgage bankers are compensated with a commission or salary for their services by their employers.