Mortgage Broker or Loan Officer

When it comes to applying for a mortgage loan, you may work with a mortgage banker or you may choose to work with a mortgage broker. As both a mortgage broker and mortgage banker will help you fund a new home, people often confuse them. However, it will be beneficial to recognize the ways they differ so you have clear expectations of them as you enter the mortgage process.

About Mortgage Brokers

A mortgage broker (either a firm or an individual) is an independent agent for the mortgage loan applicant as well as the lender. Your mortgage broker will stand as facilitator between you and the lending institution; which can be a credit union, bank, trust company, finance company, mortgage corporation or even an individual investor. Which lender has the mortgage loans that fits your needs? A mortgage broker will guide you to the best one. You deliver your mortgage application to your broker, who offers it to various lenders. Your mortgage broker then assists your work with the lender chosen until closing. At closing, the broker's commission is given by the borrower.

What is a Loan Officer?

Lending Institutions (banks, finance companies, and others) employ loan officers to market, and process mortgage loans solely from that particular institution. While a mortgage banker may market quite a range of loans, they all are programs of that specific lender.

Also called a "loan representative" or "account executive," a mortgage banker represents the borrower to the lender. The borrower is guided through the entire process, from finding the loan to closing, by the mortgage banker. Mortgage bankers are compensated with a commission or salary for their services by their employers.