Know what to expect: Mortgage Brokers vs. Mortgage Bankers
When you work on your application for a mortgage , you may work with a mortgage banker or you may choose to work with a mortgage broker. Since both reap the same outcome (a new home), people can confuse the two. But for your application process, it can benefit you if you understand how they differ.
A mortgage broker is a person or group that serves as 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 an individual, 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 a private investor. A mortgage broker will examine your finances to find out which lender is the best fit for you. From application to closing, your mortgage broker facilitates your loan process: submitting your loan application to a number of lenders, and coordinating the process with the lender through to the closing of the loan. At closing, the broker's commission is paid by the borrower.
About Loan Officers
Loan officers work for a specific lending institution (such as a bank) who work with mortgages and other loan programs for their company alone. They may have the ability to offer loans to fit a variety of situations, but all the loans will be programs of the same lender.
A mortgage banker represents you to the bank or other lending institution. The borrower is walked through the whole process, from loan selection to closing, by the loan officer. Mortgage bankers are paid a commission or salary for their services by their employers.
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