Know what to expect: Mortgage Brokers and Mortgage Bankers

Either a mortgage broker or a mortgage banker may help you when you need a mortgage . Since both a mortgage broker and mortgage banker can help you fund a new home, it's common to confuse them. But for your application process, it can benefit you if you recognize how they differ.

Mortgage Brokers

A mortgage broker (either a company or an individual) is an independent agent for both the mortgage loan borrower 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, private investor. You use a mortgage broker to consider your financial circumstance and find the lender who has the best loan for you. From application to closing, your mortgage broker facilitates your loan process: submitting your mortgage application to a number of lenders, and walking you with the chosen lender through to the closing of your loan. The broker receives a commission from the borrower if the loan closes.

About Mortgage Bankers

Mortgage Bankers are representatives of a specific lending institution (such as a bank, credit union, etc.) who market and process mortgages and other lending programs originated by their place of employment alone. Although a mortgage banker may offer quite a variety of loan programs, they will be products of that one lender.

Also called a "loan representative" or "account executive," a mortgage banker acts of behalf of the borrower to the lending institution. From finding a loan product to closing, a mortgage banker will help you through the process. Either a salary or commission is given to loan officers by their employers.