Know the difference: Mortgage Brokers and Loan Officers
When you need a mortgage loan, you may work with a mortgage banker or you may choose to work with a mortgage broker. Because both yield the same result (a new home), people usually confuse the two. However, knowing the differences between them is useful to your mortgage loan process.
What is a Mortgage Broker?
During the mortgage loan process, an individual or firm who is an independent agent for the mortgage loan borrower as well as the lender is a mortgage broker. Your mortgage broker will stand as facilitator between you and the lending institution; which may be a bank, trust company, credit union, mortgage corporation, finance company or even a private investor. Which lender has the mortgage loans that fits your financial situation? A mortgage broker will help you find the right fit. You give your application to your broker, who submits it to various lenders. Your mortgage broker then helps you work with the lender chosen until closing. The borrower submits a commission to the broker when the loan closes.
What is a Mortgage Banker?
Lending Institutions (banks, finance companies, and others) employ loan officers to promote, and process mortgage loans on behalf of that specific institution alone. They may have the ability to market loans to fit a variety of situations, but all the loans are programs of the same lender.
Also called a "loan representative" or "account executive," a loan officer acts of behalf of the borrower to the lender. A mortgage banker can guide the borrower through the selection, processing and loan closing. Either a salary or commission is given to mortgage brokers by their employers.
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