Mortgage Broker and Mortgage Banker
When you need a mortgage , you should know the difference between a mortgage broker and a mortgage banker. As both produce the same result (a new home), people often confuse the two. Yet understanding how they differ is valuable to the mortgage loan process.
What is a Mortgage Broker?
A mortgage broker is someone or company that is an independent agent for both the mortgage loan borrower 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 an individual 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 an individual, private investor. A mortgage broker can review your finances to find out which lender is the right fit for you. From application to closing, your mortgage broker facilitates the loan process: offering your loan application to several lenders, and walking you with the chosen lender through to closing. The broker gets a commission from the borrower when the loan closes.
What is a Mortgage Banker?
Lending Institutions (banks, finance companies, and others) employ mortgage bankers to promote, and process mortgage loans from that particular institution alone. They may have the ability to promote loans to fit many different situations, but all the loans will be programs of the same lender.
Your mortgage banker will represent you to the bank or other lending institution. The borrower is walked through the whole process, from finding the loan to closing, by the loan officer. Lending institutions pay their loan officers a commission or salary.
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