Know what to expect: Mortgage Brokers and Mortgage Bankers

Either a mortgage broker or a mortgage banker may help you when you work on your application for a mortgage . Since both give the same result (a new home), it's common to confuse the two job types. But as you begin the application process, it will benefit you if you recognize how they differ.

What is a Mortgage Broker?

During the mortgage loan process, an individual or firm who is an independent agent for both mortgage loan borrower and lender is a mortgage broker. A mortgage broker facilitates things for you and your lender, which can be one of the following: a credit union, bank, trust company, finance company, mortgage corporation or even an individual 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 an individual investor. You partner with a mortgage broker to look at your financial circumstance and lead you to the lender who has the right mortgage loan for you. Your broker will submit your loan application to various lenders, and works with the lender of choice until the loan closes. The borrower pays a commission to the broker at closing.

Loan Officers

Mortgage Bankers represent a particular lending institution (such as a bank) who process mortgages and other loan products originated by their place of employment alone. While a mortgage banker may offer quite a variety of loan programs, they are all programs with that one lender.

Also known as a "loan representative" or "account executive," a loan officer represents the borrower to the lender. The borrower is walked through the entire process, from loan selection to closing, by the loan officer. Lenders give their mortgage bankers a salary or commission.