Mortgage Broker vs. Loan Officer

When it's time to get a mortgage loan, you may work with a loan officer or you may choose to work with a mortgage broker. As a new home is the result of the work of both mortgage broker and loan officer, people can confuse the two job types. However, it is valuable to recognize the difference between them so you have clear expectations of them as you enter the mortgage application process.

Mortgage Brokers

A mortgage broker is a person or firm that is an independent agent for both the mortgage loan borrower and 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 credit union, bank, trust company, finance company, mortgage corporation or even an individual, private investor. You work with a mortgage broker to review your financial circumstance and lead you to the lender who has the right mortgage loan for you. Your broker will offer your loan application to various lenders, and works with the lender of choice until closing. The broker is given a commission from the borrower if the loan closes.

Mortgage Bankers

Loan officers work for a particular lending institution (such as a bank, credit union, etc.) who offer and process mortgages and other loan products originated by their place of employment alone. Although a mortgage banker may offer quite a variety of loans, they will be programs from that specific lender.

Your mortgage banker represents you to the bank or other lending institution. A mortgage banker will walk you through the selection, processing and closing of the loan. Loan officers may be compensated with a commission or salary for their services by their employers.

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