Know the difference: Mortgage Brokers vs. Loan Officers
Either a mortgage broker or a loan officer may assist you when you need a mortgage loan. Since a new home is the result of the work of both mortgage broker and mortgage banker, it's understandable to confuse them. But as you begin the application process, it can benefit you if you know how they differ.
A mortgage broker (either a group or an individual) is an independent agent for both the mortgage loan applicant 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, 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 will review your financial situation to find out which lender is the right fit for your loan needs. Your broker will submit your mortgage loan application to a handful of lenders, and works with the lender of choice until the loan closes. The broker receives a commission from the borrower at closing.
About Loan Officers
Lending Institutions (banks, finance companies, and others) employ loan officers to market, and process mortgage loans from that particular institution alone. They may have the ability to offer loans to fit many different situations, but all the loans will be programs of the same lender.
Also known as a "loan representative" or "account executive," a mortgage banker acts of behalf of the borrower to the lending institution. The loan officer will guide the borrower through the application, processing and closing of the loan. Loan officers can be given a commission or salary for their services by their employers.
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