Mortgage Broker and Loan Officer

Either a mortgage broker or a loan officer can assist you when you're looking to get a mortgage . People sometimes confuse the two because both will yield the same result: a new home. However, recognizing the differences between them will be helpful to your mortgage loan process.

What is a Mortgage Broker?

A mortgage broker (either a firm or an individual) is an independent agent for the mortgage loan borrower as well as the lender. Your mortgage broker will stand as coordinator between you and the lending institution; which can be a bank, trust company, credit union, mortgage corporation, finance company or even an individual investor. You use a mortgage broker to analyze your financial situation and lead you to the lender who has the best loan for you. Your broker will submit your mortgage loan application to various lenders, and works with the chosen lender until the loan closes. The broker receives a commission from the borrower if the loan closes.

What is a Loan Officer?

The biggest difference between a mortgage broker and a mortgage banker is that a mortgage banker is employed by a lending institution (a bank, credit union, or others) to process loans only from the products of that institution. While a mortgage banker may market quite a range of loans, they will be products with that lender alone.

Also known as a "loan representative" or "account executive," a loan officer represents the borrower to the lending institution. The mortgage banker can guide the borrower through the selection, processing and closing of the loan. Either a salary or commission is given to loan officers by their employers.