Mortgage Broker and Mortgage Banker
When you're looking to get a mortgage loan, you need to know the difference between a mortgage broker and a loan officer. Because both reap the same result (a new home), it's easy to confuse the two job types. However, it will be valuable to know the ways they differ so you know what to expect from them during your mortgage process.
A mortgage broker is a person or group that is an independent agent for the mortgage loan borrower as well as the lender. A mortgage broker coordinates things for you and your lender, which can be one of the following: a bank, trust company, credit union, mortgage corporation, finance company or even an individual 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. You use a mortgage broker to consider your financial circumstance and find the lender who has the right loan for you. You give your mortgage application to your broker, who presents it to one or more lenders. Your mortgage broker then guides your work with the lender chosen until closing. The broker is given a commission from the borrower upon closing.
Lending Institutions (banks, finance companies, and others) employ mortgage bankers to offer, and process loans on behalf of that particular institution alone. Although a mortgage banker may promote quite a variety of loans, they are all products with that lender alone.
Also known as a "loan representative" or "account executive," a mortgage banker acts of behalf of the borrower to the lender. The borrower is walked through the entire process, from loan selection to closing, by the mortgage banker. Mortgage bankers may be compensated with a commission or salary for their work by their employers.
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