Mortgage Broker and Loan Officer

When you need a mortgage loan, you may work with a loan officer or you may choose to work with a mortgage broker. Since a new home is the outcome of the work of both mortgage broker and mortgage banker, it's easy to confuse them. However, it is useful to understand the difference between the two jobs so you know what to expect from them during your mortgage process.

About Mortgage Brokers

A mortgage broker (either a firm or an individual) is an independent agent for both the mortgage loan borrower and the lender. A mortgage broker coordinates 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 a 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 investor. A mortgage broker can review your finances to determine which lender is the right fit for you. Your broker will submit your mortgage application to various lenders, and works with the chosen lender until closing. The broker receives a commission from the borrower at closing.

About Mortgage Bankers

Loan officers represent a particular lending institution (such as a bank) who promote and process mortgages and other loan programs for their company alone. Although a loan officer may market quite a variety of loans, they are all products from that lender alone.

A mortgage banker (also known as an "account executive" or "loan representative") acts on behalf of the borrower to the lender. The borrower is guided through the whole process, from finding the loan to closing, by the loan officer. Lending institutions compensate the mortgage bankers with a salary or commission.