Mortgage Broker vs. Mortgage Banker

Either a mortgage broker or a loan officer can work with you when it's time to get a mortgage loan. It's easy to confuse these since both will produce the same result: a new home. Yet understanding how they differ is useful to your mortgage loan process.

What is a Mortgage Broker?

During the mortgage loan process, an individual or company who is an independent agent for both mortgage loan applicant and lender is a mortgage broker. Your mortgage broker will stand as facilitator between you and the lending institution; which can be a bank, trust company, credit union, mortgage corporation, finance company or even a private investor. You use a mortgage broker to analyze your financial situation and find the lender who has the right loan for you. You give your mortgage application to your broker, who presents it to several lenders. Your mortgage broker then assists your work with the lender chosen until the loan closes. The broker is given a commission from the borrower if the loan closes.

Loan Officers

Mortgage Bankers work for a particular lending institution (such as a bank, credit union, etc.) who process mortgages and other lending programs from their company alone. While a loan officer may promote quite a range of loans, they all are programs of that lender alone.

A mortgage banker (also known as an "account executive" or "loan representative") represents the borrower to the lender. From finding a loan to closing, a mortgage banker will help the borrower through the process. Lending institutions give their loan officers a commission or salary.

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