Mortgage Broker vs. Mortgage Banker

Either a mortgage broker or a loan officer may work with you when you're looking to get a mortgage loan. People frequently confuse the two job types since both will reap the same result: a new home. However, it is beneficial to know the ways they differ so you have clear expectations of them during the mortgage process.

About Mortgage Brokers

A mortgage broker (either a firm or an individual) is an independent agent for the mortgage loan applicant as well as the lender. Your mortgage broker will stand as coordinator between you and the lending institution; which may be a bank, trust company, credit union, mortgage corporation, finance company or even a private investor. You work with a mortgage broker to consider your financial circumstance and lead you to the lender who has the right loan program for you. You deliver your mortgage application to your broker, who submits it to one or more lenders. Your mortgage broker then guides your work with the lender of choice until closing. The borrower gives a commission to the broker if the loan closes.

About Mortgage Bankers

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

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

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