Mortgage Broker and Loan Officer
When it comes to locating a mortgage loan, you need to know the difference between a mortgage broker and a loan officer. As both give the same outcome (a new home), it's easy to confuse them. But as you enter the application process, it can help if you know their differences.
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 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 bank, trust company, credit union, mortgage corporation, finance company or even an individual investor. A mortgage broker can analyze your finances to find out which lender is the best fit for you. From application to closing, your mortgage broker facilitates your loan process: submitting your mortgage application to a number of lenders, and coordinating the process with the lender through to the closing of your loan. If the loan closes, the broker's commission is given by the borrower.
Lending Institutions (banks, finance companies, and others) employ mortgage bankers to offer, and process mortgage loans solely on behalf of that specific institution. There can be a wide variety of loans types to choose from although all are products of that specific lender.
Also known as a "loan representative" or "account executive," a mortgage banker acts of behalf of the borrower to the lender. The borrower is helped through the entire process, from loan selection to closing, by the mortgage banker. Mortgage bankers are given a commission or salary for their work by their employers.
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