Know what to expect: Mortgage Brokers and Mortgage Bankers
Either a mortgage broker or a mortgage banker may work with you when it comes to applying for a mortgage . People can confuse them since both will give the same result: a new home. Yet recognizing the ways they differ is useful to your mortgage process.
About Mortgage Brokers
A mortgage broker is a person or group that works as an independent agent for the mortgage loan applicant as well as the lender. Your mortgage broker will stand as coordinator between you and the lending institution; which may be a credit union, bank, trust company, finance company, mortgage corporation or even an individual, private investor. You work with a mortgage broker to review your financial situation and find the lender who has the best loan for you. Your broker will offer your mortgage loan application to one or more lenders, and works with the lender of choice until closing. The broker gets a commission from the borrower when the loan closes.
What is a Loan Officer?
Mortgage Bankers represent a specific lending institution (such as a bank) who market and process mortgages and other loan programs on behalf of their place of employment alone. While a loan officer may market quite a range of loan programs, they are all programs with that lender alone.
Also known as a "loan representative" or "account executive," a loan officer represents the borrower to the lender. The borrower is helped through the entire process, from choosing the loan to closing, by the mortgage banker. Either a salary or commission is paid to loan officers by their employers.
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