Mortgage Broker and Mortgage Banker

When you need a mortgage , you may work with a mortgage banker or you may choose to work with a mortgage broker. Since both yield the same outcome (a new home), people often confuse the two. Yet knowing the ways they differ will be beneficial to your mortgage loan process.

What is a Mortgage Broker?

During the mortgage loan process, an individual or group who is an independent agent for both mortgage loan applicant 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 credit union, bank, trust company, finance company, mortgage corporation or even an individual, private investor. Which lender offers the mortgage loans that is best for you? A mortgage broker will help you find the best fit. Your broker will present your mortgage loan application to one or more lenders, and works with the lender of choice until the loan closes. The borrower submits a commission to the broker upon closing.

About Mortgage Bankers

The biggest difference between a mortgage broker and a loan officer is that a loan officer works on behalf of a lending institution (a bank, credit union, or others) to process loans solely originated from that institution. There may be a variety of loans types to draw from although all are programs of that particular lending institution.

Also called a "loan representative" or "account executive," a loan officer represents the borrower to the lender. From choosing a loan program to closing, a loan officer will help you through the process. Lenders give their mortgage bankers a commission or salary.

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