Mortgage Broker vs. Mortgage Banker

Either a mortgage broker or a loan officer may assist you when you're looking to get a mortgage . As both a mortgage broker and lending officer can help you purchase a new home, it's easy to confuse the two. However, recognizing the differences between them will be important to the mortgage process.

About Mortgage Brokers

During the mortgage loan process, an individual or group who is an independent agent for both mortgage loan applicant and lender is a mortgage broker. A mortgage broker facilitates things between 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, private investor. Acting as a facilitator between you and your lender, your mortgage broker can match you with a credit union, bank, trust company, finance company, mortgage corporation or even an individual investor. A mortgage broker can analyze your financial situation to determine which lender is the right fit for your loan needs. Your broker will submit your loan application to several lenders, and works with the chosen lender until the loan closes. If the loan closes, the broker's commission comes from the borrower.

About Loan Officers

Lending Institutions (banks, finance companies, and others) employ mortgage bankers to promote, and process loans solely from that particular institution. They may be able to promote loans to fit a variety of situations, but all the loans will be products from the same lender.

A loan officer (also called an "account executive" or "loan representative") acts on behalf of the borrower to the lending institution. The borrower is guided through the entire process, from loan selection to closing, by the loan officer. Lending institutions pay their mortgage bankers a commission or salary.

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