Mortgage Broker vs. Mortgage Banker

Either a mortgage broker or a mortgage banker can work with you when it's time to locate a mortgage loan. As both produce the same outcome (a new home), people often confuse the two. However, it is beneficial to recognize the difference between the two jobs so you know what to expect from them during the mortgage application process.

About Mortgage Brokers

A mortgage broker (either a company or an individual) is an independent agent for the mortgage loan applicant as well as 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 a private 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 look at your finances to find out which lender is the best fit for you. You give your mortgage loan application to your broker, who offers it to several lenders. Your mortgage broker then guides your work with the lender chosen until the closing of the loan. The borrower gives a commission to the broker when the loan closes.

Loan Officers

Mortgage Bankers represent a particular lending institution (such as a bank, credit union, etc.) who work with mortgages and other loans originated by their company alone. While a mortgage banker may market quite a variety of loans, they all are products from that lender alone.

A mortgage banker (also called an "account executive" or "loan representative") acts on behalf of the borrower to the lending institution. The loan officer will walk you through the selection, processing and closing of the loan. Mortgage bankers can be compensated with a commission or salary for their services by their employers.

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