Mortgage Broker and Loan Officer

When it's time to get a mortgage loan, you need to know the difference between a loan officer and a mortgage broker. Since both a mortgage broker and mortgage banker will help you purchase a new home, people sometimes confuse them. However, it will be beneficial to understand how they differ so you know what to expect from them during your mortgage application process.

About Mortgage Brokers

During the mortgage loan process, an individual or firm who is an independent agent for the mortgage loan applicant as well as the lender is a mortgage broker. Your mortgage broker will stand as coordinator between you and the lending institution; which may be a bank, trust company, credit union, mortgage corporation, finance company or even an individual, private investor. You use a mortgage broker to examine your financial situation and find the lender who has the right loan program for you. Your broker will submit your mortgage application to various lenders, and works with the lender of choice until the loan closes. When the loan closes, the broker's commission is given by the borrower.

Mortgage Bankers

Lending Institutions (banks, finance companies, and others) employ loan officers to offer, and process loans solely from that specific institution. There can be an assortment of loans types to draw from, but all are products of that specific lender.

Also known as a "loan representative" or "account executive," a mortgage banker acts of behalf of the borrower to the lending institution. A loan officer will walk you through the selection, processing and closing of the loan. Lending institutions give their mortgage bankers a commission or salary.

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