Mortgage Broker and Loan Officer

When you apply for a mortgage , you may work with a loan officer or you may choose to work with a mortgage broker. It's common to confuse the two job types since both will produce the same outcome: a new home. Yet it is helpful to understand the difference between them so you have clear expectations of them as you enter the mortgage application process.

What is a Mortgage Broker?

A mortgage broker (either a company or an individual) is an independent agent for both the mortgage loan applicant and the lender. A mortgage broker facilitates 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 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. 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 offer your mortgage loan application to several lenders, and works with the chosen lender until the loan closes. The borrower submits a commission to the broker if the loan closes.

Loan Officers

The main difference between a mortgage broker and a loan officer is that the latter is employed by a lending institution (a bank, credit union, or others) to process loans only originated from the products of that institution. Although a loan officer may offer quite a variety of loans, they will be products of that lender alone.

A mortgage banker will represent you to the bank or other lending institution. The borrower is walked through the whole process, from choosing a loan to closing, by the mortgage banker. Either a salary or commission is given to loan officers by their employers.

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