Know what to expect: Mortgage Brokers vs. Mortgage Bankers
When it comes to getting a mortgage , you should know the difference between a mortgage banker and a mortgage broker. It's understandable to confuse them because both will produce the same result: a new home. Yet it is useful to know the difference between the two jobs so you know what to expect from them during the mortgage process.
What is a Mortgage Broker?
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 between you and your lender, which can be one of the following: a bank, trust company, credit union, mortgage corporation, finance company or even a private investor. Acting as a facilitator between you and your lender, your mortgage broker can match you with a bank, trust company, credit union, mortgage corporation, finance company or even an individual, private investor. Which lender has the loans that fits your needs? A mortgage broker will lead you to the right fit. Your broker will submit your loan application to a handful of lenders, and works with the lender of choice until closing. Upon closing, the broker's commission comes from the borrower.
What is a Loan Officer?
Loan officers work for a specific lending institution (such as a bank) who offer and process mortgages and other loan products originated by their company alone. There may be a wide variety of loans types to choose from, but all are products of that particular lender.
Also called a "loan representative" or "account executive," a mortgage banker represents the borrower to the lending institution. A loan officer will walk the borrower through the application, processing and closing of the loan. Mortgage bankers are paid a commission or salary for their services by their employers.
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