Know what to expect: Mortgage Brokers vs. Mortgage Bankers

When you work on your application for a mortgage , you need to know the difference between a mortgage banker and a mortgage broker. Because both yield the same result (a new home), people frequently confuse the two job types. However, it is useful to know how they differ so you have clear expectations of them during the mortgage process.

About Mortgage Brokers

A mortgage broker (either a group or an individual) is an independent agent for the mortgage loan borrower as well as the lender. A mortgage broker facilitates things for 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 a private investor. Which lender offers the loan programs that is right for you? A mortgage broker will guide you to the right fit. From application to closing, your mortgage broker facilitates your loan process: presenting your loan application to several lenders, and coordinating the process with the lender through to the closing of your loan. The broker gets a commission from the borrower upon closing.

Loan Officers

Lending Institutions (banks, finance companies, and others) employ mortgage bankers to offer, and process loans originated by that particular institution alone. Although a loan officer may promote quite a variety of loans, they are all products from that lender alone.

A loan officer represents you to the bank or other lending institution. From choosing a loan program to closing, a loan officer will walk you through the process. Either a salary or commission is given to mortgage brokers by their employers.