Know the difference: Mortgage Brokers and Loan Officers
When it's time to apply for a mortgage , you may work with a mortgage banker or you may choose to work with a mortgage broker. Since both a mortgage broker and mortgage banker will help you buy your new home, it's easy to confuse them. However, understanding the differences between them is advantageous to your mortgage loan process.
About Mortgage Brokers
During the mortgage loan process, an individual or firm who is an independent agent for both mortgage loan applicant and lender is a mortgage broker. Your mortgage broker will stand as coordinator between you and the lending institution; which can be a bank, trust company, credit union, mortgage corporation, finance company or even an individual investor. A mortgage broker can look at your finances to find out which lender is the best fit for your loan needs. From application to closing, your mortgage broker facilitates your loan process: offering your application to several lenders, and coordinating the process with the lender through to closing. The borrower submits a commission to the broker at closing.
The biggest difference between a mortgage broker and a loan officer is that a mortgage banker works on behalf of a lending institution (a bank, credit union, or others) to process loans only from that institution. They may be able to market loans to fit many different situations, but all the loans will be programs from the same lender.
A mortgage banker will represent you to the bank or other lending institution. From choosing a loan to closing, a loan officer will walk you through the process. Loan officers are compensated with a commission or salary for their services by their employers.
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