Mortgage Broker or Mortgage Banker

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. People usually confuse them since both will reap the same outcome: a new home. But as you enter your application process, it will help if you understand their differences.

About Mortgage Brokers

A mortgage broker is a person or group that serves as an independent agent for both the mortgage loan borrower and the lender. Your mortgage broker will stand as facilitator between you and the lending institution; which can be a bank, trust company, credit union, mortgage corporation, finance company or even an individual, private investor. Which lender offers the mortgage loans that is right for you? A mortgage broker will help you find the right one. Your broker will present your mortgage loan application to one or more lenders, and works with the chosen lender until the loan closes. The borrower pays a commission to the broker upon closing.

What is a Loan Officer?

Loan officers represent a specific lending institution (such as a bank) who promote and process mortgages and other loan programs originated by their place of employment alone. While a mortgage banker may market quite a range of loan programs, they all are programs of that particular lender.

Your mortgage banker represents you to the bank or other lending institution. The borrower is helped through the entire process, from finding a loan to closing, by the mortgage banker. Lending institutions compensate the loan officers with a salary or commission.