Mortgage Broker or Loan Officer

Either a mortgage broker or a mortgage banker may assist you when you're looking to get a mortgage loan. It's easy to confuse the two since both will give the same outcome: a new home. But as you begin the application process, it can help if you recognize how they are different.

About Mortgage Brokers

During the mortgage loan process, an individual or group who is an independent agent for both mortgage loan borrower and lender is a mortgage broker. Your mortgage broker will stand as coordinator between you and the lending institution; which can be a bank, trust company, credit union, mortgage corporation, finance company or even an individual investor. You use a mortgage broker to look at your financial circumstance and find the lender who has the right loan for you. From application to closing, your mortgage broker works with you: offering your loan application to a number of lenders, and walking you with the chosen lender through to closing. The broker gets a commission from the borrower if the loan closes.

What is a Loan Officer?

The most important difference between a mortgage broker and a loan officer is that the latter works on behalf of a lending institution (a bank, credit union, or others) to process loans solely from that institution. There may be an assortment of loans types to draw from even though all are products of that specific lender.

A mortgage banker (also called an "account executive" or "loan representative") represents the borrower to the lender. The borrower is guided through the whole process, from loan selection to closing, by the loan officer. Loan officers will be paid a commission or salary for their work by their employers.