Mortgage Broker or Loan Officer

When it's time to find a mortgage , you may work with a loan officer or you may choose to work with a mortgage broker. As a new home is the result of the work of both mortgage broker and loan officer, people can confuse the two. Yet understanding the ways they differ is valuable to your mortgage process.

What is a Mortgage Broker?

A mortgage broker is an individual or firm that is an independent agent for both the mortgage loan applicant and the lender. Your mortgage broker will stand as facilitator between you and the lending institution; which can be a credit union, bank, trust company, finance company, mortgage corporation or even a private investor. You partner with a mortgage broker to analyze your financial circumstance and find the lender who has the right loan for you. You deliver your loan application to your broker, who offers it to several lenders. Your mortgage broker then guides your work with the lender of choice until closing. The borrower submits a commission to the broker at closing.

About Loan Officers

The most important difference between a mortgage broker and a mortgage banker is that the latter is employed by a lending institution (a bank, credit union, or others) to market and process loans solely originated from the programs of that institution. While a mortgage banker may market quite a variety of loans, they will be programs of that particular lender.

A mortgage banker (also called an "account executive" or "loan representative") represents the borrower to the 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.

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