Mortgage Broker or Loan Officer

When you work on your application 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 lending officer will help you fund a new home, it's common to confuse them. However, knowing the ways they differ will be valuable to the mortgage process.

What is a Mortgage Broker?

A mortgage broker (either a company or an individual) is an independent agent for both the mortgage loan applicant and the lender. Your mortgage broker will stand as coordinator 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 application to your broker, who offers it to one or more lenders. Your mortgage broker then helps you work with the lender of choice until the closing of the loan. The borrower pays a commission to the broker at closing.

Loan Officers

Lending Institutions (banks, finance companies, and others) employ mortgage bankers to promote, and process loans from that particular institution alone. While a loan officer may offer quite a variety of loan programs, they will be programs of that one lender.

Also known as a "loan representative" or "account executive," a loan officer represents the borrower to the lender. From finding a loan program to closing, a loan officer can guide the borrower through the process. Loan officers are compensated with a commission or salary for their services by their employers.