Mortgage Broker or Loan Officer

Either a mortgage broker or a loan officer can assist you when you apply for a mortgage loan. Since both produce the same outcome (a new home), it's understandable to confuse the two. Yet it will be helpful to recognize how they differ so you know what to expect from them as you enter your mortgage process.

What is a Mortgage Broker?

A mortgage broker is an individual or firm that acts as an independent agent for both the mortgage loan borrower and the lender. 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 a private investor. You partner with a mortgage broker to look at your financial circumstance and find the lender who has the best mortgage loan for you. Your broker will offer your mortgage loan application to several lenders, and works with the chosen lender until closing. When the loan closes, the broker's commission comes from the borrower.

Mortgage Bankers

The main difference between a mortgage broker and a loan officer is that a mortgage banker works for a lending institution (a bank, credit union, or others) to market and process loans only from that institution. They may have the ability to offer loans to fit many different situations, but all the loans will be products of the same lender.

A loan officer (also called an "account executive" or "loan representative") represents the borrower to the lending institution. The borrower is walked through the whole process, from choosing a loan to closing, by the loan officer. Loan officers may be paid a commission or salary for their services by their employers.