Mortgage Broker vs. Loan Officer

Either a mortgage broker or a mortgage banker can assist you when you work on your application for a mortgage loan. Since both a mortgage broker and mortgage banker can help you fund a new home, people often confuse the two. Yet it is valuable to understand the ways they differ so you know what to expect from them as you enter the mortgage application process.

About Mortgage Brokers

During the mortgage loan process, an individual or company who is an independent agent for the mortgage loan borrower as well as the lender is a mortgage broker. A mortgage broker coordinates 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, 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 an individual, private investor. Which lender has the loan programs that is right for you? A mortgage broker will help you find the best fit. From application to closing, your mortgage broker works with you: offering your mortgage application to several lenders, and walking you with the chosen lender through to the closing of your loan. The borrower gives a commission to the broker at closing.

About Loan Officers

Lending Institutions (banks, finance companies, and others) employ mortgage bankers to promote, and process loans solely on behalf of that specific institution. Although a loan officer may market quite a variety of loans, they are all products of that lender alone.

A loan officer (also called an "account executive" or "loan representative") represents the borrower to the lending institution. The borrower is helped through the entire process, from choosing a loan to closing, by the loan officer. Lending institutions compensate their loan officers with a commission or salary.