Mortgage Broker and Loan Officer

When you need a mortgage , you need to know the difference between a loan officer and a mortgage broker. People can confuse these because both will reap the same outcome: a new home. But as you enter the application process, it can benefit you if you know they ways they differ.

Mortgage Brokers

A mortgage broker is an individual or group that works as an independent agent for both the mortgage loan applicant and the lender. A mortgage broker coordinates things between you and your lender, which can be one of the following: a credit union, bank, trust company, finance company, mortgage corporation or even an individual, 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 a private investor. A mortgage broker can look at your financial situation to find out which lender is the best fit for you. From application to closing, your mortgage broker facilitates your loan process: presenting your mortgage application to several lenders, and walking you with the chosen lender through to the closing of your loan. When the loan closes, the broker's commission is paid by the borrower.

What is a Mortgage Banker?

Loan officers work for a specific lending institution (such as a bank, credit union, etc.) who process mortgages and other loan products from their company alone. There can be a variety of loans types to choose from even though all are programs of that specific lending institution.

A mortgage banker (also known as an "account executive" or "loan representative") represents the borrower to the lender. The borrower is walked through the entire process, from selecting a loan to closing, by the mortgage banker. Lending institutions compensate their loan officers with a commission or salary.