Mortgage Broker vs. Loan Officer

When you work on your application for a mortgage , you should know the difference between a mortgage banker and a mortgage broker. Because both a mortgage broker and mortgage banker can help you fund your new home, it's easy to confuse the two. However, it will be valuable to know the difference between them so you know what to expect from them during the mortgage application process.

Mortgage Brokers

A mortgage broker is a person or firm that acts as an independent agent for both the mortgage loan applicant 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 an individual, private investor. Which lender has the loans that fits your needs? A mortgage broker will guide you to the right one. You give your loan application to your broker, who submits it to one or more lenders. Your mortgage broker then guides your work with the lender chosen until the loan closes. The broker is given a commission from the borrower upon closing.

Loan Officers

Mortgage Bankers are representatives of a particular lending institution (such as a bank, credit union, etc.) who offer and process mortgages and other loans on behalf of their employer alone. While a loan officer may promote quite a variety of loans, they all are products with that lender alone.

Also called a "loan representative" or "account executive," a mortgage banker represents the borrower to the lending institution. From choosing a loan program to closing, a mortgage banker can guide the borrower through the process. Either a salary or commission is given to mortgage brokers by their employers.

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