Know what to expect: Mortgage Brokers and Mortgage Bankers
Either a mortgage broker or a loan officer can assist you when it comes to finding a mortgage loan. Since a new home is the result of the work of both mortgage broker and mortgage banker, it's understandable to confuse them. Yet it is beneficial to understand the ways they differ so you know what to expect from them during the mortgage process.
About Mortgage Brokers
During the mortgage loan process, an individual or company who is an independent agent for both mortgage loan borrower and lender is a mortgage broker. A mortgage broker coordinates things for 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 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 a private investor. You work with a mortgage broker to consider your financial situation and lead you to the lender who has the right mortgage loan for you. Your broker will submit your loan application to several lenders, and works with the lender of choice until closing. The borrower submits a commission to the broker when the loan closes.
What is a Loan Officer?
Mortgage Bankers work for a specific lending institution (such as a bank, credit union, etc.) who process mortgages and other loans originated by their employer alone. There can be an assortment of loans types to draw from, but all are programs of that particular lending institution.
Your loan officer represents you to the bank or other lending institution. The loan officer can guide you through the application, processing and loan closing. Lenders compensate their loan officers with a salary or commission.
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