Know what to expect: Mortgage Brokers and Loan Officers

When you work on your application for a mortgage loan, you need to know the difference between a mortgage broker and a mortgage banker. As a new home is the outcome of the work of both mortgage broker and loan officer, people usually confuse them. But as you enter your application process, it will benefit you if you recognize they ways they differ.

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. Your mortgage broker will stand as coordinator between you and the lending institution; which can be a bank, trust company, credit union, mortgage corporation, finance company or even an individual, private investor. A mortgage broker can analyze your numbers to find out which lender is the best fit for your loan needs. You give your mortgage application to your broker, who submits it to a number of lenders. Your mortgage broker then helps you work with the lender chosen until closing. When the loan closes, the broker's commission is given by the borrower.

Loan Officers

Loan officers represent a particular lending institution (such as a bank, credit union, etc.) who offer and process mortgages and other loans from their place of employment alone. While a mortgage banker may promote quite a variety of loans, they will be programs with that specific lender.

Your loan officer represents you to the bank or other lending institution. The loan officer can help the borrower through the application, processing and closing of the loan. Mortgage bankers are given a commission or salary for their services by their employers.