Mortgage Broker and Loan Officer

Either a mortgage broker or a mortgage banker can work with you when you apply for a mortgage loan. Because both give the same result (a new home), people can confuse the two. However, it will be beneficial to understand the difference between them so you have clear expectations of them during your mortgage application process.

What is a Mortgage Broker?

During the mortgage loan process, an individual or firm who is an independent agent for the mortgage loan borrower as well as the lender is a mortgage broker. Your mortgage broker will stand as facilitator between you and the lending institution; which may be a credit union, bank, trust company, finance company, mortgage corporation or even an individual, private investor. A mortgage broker will look at your numbers to find out which lender is the right fit for you. You deliver your mortgage loan application to your broker, who presents it to various lenders. Your mortgage broker then guides your work with the lender of choice until the closing of the loan. Upon closing, the broker's commission is given by the borrower.

What is a Mortgage Banker?

Mortgage Bankers work for a particular lending institution (such as a bank, credit union, etc.) who process mortgages and other loan products originated by their place of employment alone. They may have the ability to offer loans to fit many different situations, but all the loans will be products from the same lender.

Your loan officer will represent you to the bank or other lending institution. The borrower is guided through the entire process, from loan selection to closing, by the loan officer. Lending institutions give their loan officers a salary or commission.