Mortgage Broker vs. Mortgage Banker
When it's time to find a mortgage , you should know the difference between a mortgage broker and a loan officer. As both a mortgage broker and lending officer can help you buy your new home, people usually confuse the two. However, recognizing the ways they differ is important to your mortgage 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 may be a credit union, bank, trust company, finance company, mortgage corporation or even an individual, private investor. Which lender offers the mortgage loans that is right for you? A mortgage broker will lead you to the best fit. Your broker will submit your loan application to a handful of lenders, and works with the chosen lender until the loan closes. The borrower submits a commission to the broker if the loan closes.
What is a Loan Officer?
Lending Institutions (banks, finance companies, and others) employ mortgage bankers to market, and process mortgage loans on behalf of that particular institution alone. They may have the ability to market loans to fit many different situations, but all the loans are products from the same lender.
A mortgage banker (also called an "account executive" or "loan representative") acts on behalf of the borrower to the lending institution. The borrower is guided through the whole process, from choosing the loan to closing, by the loan officer. Lenders pay their loan officers a commission or salary.
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