Know what to expect: Mortgage Brokers and Loan Officers

When it's time to get a mortgage , you need to know the difference between a mortgage banker and a mortgage broker. As a new home is the result of the work of both mortgage broker and loan officer, it's easy to confuse the two. Yet it is useful to know the ways they differ so you have clear expectations of them during your mortgage application process.

What is a Mortgage Broker?

A mortgage broker is someone or firm that is an independent agent for both the mortgage loan borrower and the lender. A mortgage broker facilitates 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, 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 a private investor. A mortgage broker will review your numbers to find out which lender is the best fit for your loan needs. You give your application to your broker, who submits it to a number of lenders. Your mortgage broker then assists your work with the lender of choice until the closing of the loan. When the loan closes, the broker's commission is paid by the borrower.

About Mortgage Bankers

Mortgage Bankers work for a specific lending institution (such as a bank, credit union, etc.) who work with mortgages and other lending programs from their company alone. They may be able to promote loans to fit many different situations, but all the loans are products of the same lender.

A loan officer (also called an "account executive" or "loan representative") acts on behalf of the borrower to the lending institution. A mortgage banker can walk the borrower through the application, processing and loan closing. Either a salary or commission is given to mortgage brokers by their employers.

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