Mortgage Broker and Mortgage Banker

When you're looking to get a mortgage loan, you may work with a loan officer or you may choose to work with a mortgage broker. Since both produce the same result (a new home), it's easy to confuse the two. Yet it will be helpful to understand how they differ so you have clear expectations of them during your mortgage application process.

About Mortgage Brokers

A mortgage broker (either a group or an individual) is an independent agent for the mortgage loan applicant as well as 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 a 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 can look at your finances to find out which lender is the right fit for your loan needs. You deliver your mortgage application to your broker, who submits it to several lenders. Your mortgage broker then assists your work with the lender of choice until the loan closes. The borrower pays a commission to the broker at closing.

What is a Loan Officer?

Lending Institutions (banks, finance companies, and others) employ mortgage bankers to promote, and process loans solely originated by that particular institution. There may be an assortment of loans types to choose from, but all are products of that specific lending institution.

A loan officer represents you to the bank or other lending institution. A loan officer can guide you through the selection, processing and loan closing. Loan officers will be compensated with a commission or salary for their services by their employers.