Know the difference: Mortgage Brokers and Mortgage Bankers
Either a mortgage broker or a loan officer can work with you when you apply for a mortgage loan. It's easy to confuse the two as both will give the same result: a new home. But for the application process, it can help if you recognize they ways they differ.
About Mortgage Brokers
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 coordinates 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 credit union, bank, trust company, finance company, mortgage corporation or even a private investor. A mortgage broker can review your finances to determine which lender is the best fit for your loan needs. From application to closing, your mortgage broker facilitates the loan process: presenting your loan application to a number of lenders, and coordinating the process with the lender through to the closing of the loan. The broker receives a commission from the borrower upon closing.
Mortgage Bankers represent a specific lending institution (such as a bank) who market and process mortgages and other loan products on behalf of their place of employment alone. While a mortgage banker may offer quite a variety of loans, they will be products of that lender alone.
A mortgage banker (also called an "account executive" or "loan representative") represents the borrower to the lending institution. The borrower is guided through the entire process, from loan selection to closing, by the mortgage banker. Either a salary or commission is paid to loan officers by their employers.
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