Mortgage Broker or Mortgage Banker

When it comes to locating a mortgage , you may work with a mortgage banker or you may choose to work with a mortgage broker. People often confuse them as both will produce the same outcome: a new home. However, it will be helpful to know the ways they differ so you have clear expectations of them as you enter the mortgage application process.

About Mortgage Brokers

A mortgage broker (either a firm or an individual) is an independent agent for both the mortgage loan applicant and the lender. Your mortgage broker will stand as facilitator between you and the lending institution; which may be a credit union, bank, trust company, finance company, mortgage corporation or even an individual investor. A mortgage broker will look at your numbers to determine which lender is the right fit for your loan needs. You deliver your mortgage application to your broker, who offers it to various lenders. Your mortgage broker then helps you work with the lender of choice until closing. The borrower submits a commission to the broker upon closing.

About Mortgage Bankers

Mortgage Bankers represent a specific lending institution (such as a bank, credit union, etc.) who market and process mortgages and other lending programs from their employer alone. They may be able to promote loans to fit many different situations, but all the loans will be programs from the same lender.

A mortgage banker (also known as an "account executive" or "loan representative") acts on behalf of the borrower to the lender. The borrower is helped through the whole process, from choosing a loan to closing, by the mortgage banker. Either a salary or commission is given to mortgage brokers by their employers.

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