Mortgage Broker or Loan Officer

Either a mortgage broker or a mortgage banker may assist you when you apply for a mortgage . As both produce the same result (a new home), it's understandable to confuse the two. But as you enter your application process, it will benefit you if you know how they are different.

Mortgage Brokers

A mortgage broker is a person or firm that is an independent agent for both the mortgage loan applicant and the lender. Your mortgage broker will stand as coordinator between you and the lending institution; which can be a credit union, bank, trust company, finance company, mortgage corporation or even an individual, private investor. Which lender offers the loan programs that fits your financial situation? A mortgage broker will guide you to the right fit. You give your application to your broker, who offers it to various lenders. Your mortgage broker then helps you work with the lender chosen until closing. If the loan closes, the broker's commission is paid by the borrower.

Loan Officers

The most important difference between a mortgage broker and a mortgage banker is that a loan officer works for a lending institution (a bank, credit union, or others) to promote and process loans only from the products of that institution. There may be a variety of loans types to choose from even though all are products of that specific lender.

A mortgage banker represents you to the bank or other lending institution. From finding a loan to closing, a mortgage banker will walk a borrower through the process. Loan officers are paid a commission or salary for their work by their employers.