Mortgage Broker vs. Loan Officer

Either a mortgage broker or a mortgage banker may work with you when you need a mortgage loan. As both a mortgage broker and lending officer can help you buy a new home, it's easy to confuse the two. However, it will be valuable to recognize the difference between the two jobs so you have clear expectations of them as you enter the mortgage application process.

What is a Mortgage Broker?

A mortgage broker is someone or group that is an independent agent for the mortgage loan borrower as well as the lender. A mortgage broker coordinates things between you and your lender, which can be one of the following: a credit union, bank, trust company, finance company, mortgage corporation or even an individual, private investor. Acting as a facilitator between you and your lender, your mortgage broker can match you with a credit union, bank, trust company, finance company, mortgage corporation or even an individual, private investor. You use a mortgage broker to examine your financial situation and lead you to the lender who has the right mortgage loan for you. From application to closing, your mortgage broker works with you: offering your application to a number of lenders, and coordinating the process with the lender through to closing. The broker receives a commission from the borrower upon closing.

Mortgage Bankers

Lending Institutions (banks, finance companies, and others) employ loan officers to market, and process mortgage loans on behalf of that specific institution alone. Although a loan officer may offer quite a variety of loan programs, they will be programs of that specific lender.

A mortgage banker represents you to the bank or other lending institution. From selecting a loan program to closing, a loan officer can guide you through the process. Lenders compensate their mortgage bankers with a salary or commission.