Mortgage Broker and Loan Officer

When you need a mortgage loan, you should know the difference between a loan officer and a mortgage broker. Since both yield the same outcome (a new home), it's easy to confuse the two. But as you enter your application process, it will benefit you if you recognize how they differ.

What is a Mortgage Broker?

During the mortgage loan process, an individual or group who is an independent agent for the mortgage loan applicant as well as the lender is a mortgage broker. A mortgage broker facilitates things between 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 bank, trust company, credit union, mortgage corporation, finance company or even a private investor. Which lender offers the loan programs that is right for you? A mortgage broker will help you find the best fit. Your broker will offer your mortgage application to various lenders, and works with the chosen lender until the loan closes. At closing, the broker's commission is paid by the borrower.

About Loan Officers

Mortgage Bankers work for a specific lending institution (such as a bank) who work with mortgages and other lending programs originated by their place of employment alone. They may have the ability to promote loans to fit a variety of situations, but all the loans are programs from the same lender.

Also called a "loan representative" or "account executive," a loan officer acts of behalf of the borrower to the lending institution. The mortgage banker can guide you through the selection, processing and closing of the loan. Loan officers may be paid a commission or salary for their services by their employers.