Mortgage Broker vs. Mortgage Banker

Either a mortgage broker or a loan officer may work with you when you're looking to get a mortgage loan. Since both a mortgage broker and mortgage banker will help you buy a new home, people frequently confuse the two. Yet recognizing the differences between them is helpful to your mortgage process.

What is a Mortgage Broker?

During the mortgage loan process, an individual or company who is an independent agent for the mortgage loan borrower as well as the lender is a mortgage broker. Your mortgage broker will stand as facilitator between you and the lending institution; which may be a bank, trust company, credit union, mortgage corporation, finance company or even a private investor. A mortgage broker will look at your financial situation to find out which lender is the best fit for your loan needs. From application to closing, your mortgage broker facilitates the loan process: presenting your application to a number of lenders, and walking you with the chosen lender through to the closing of your loan. The broker gets a commission from the borrower if the loan closes.

About Loan Officers

Loan officers work for a specific lending institution (such as a bank, credit union, etc.) who work with mortgages and other loans from their employer alone. While a loan officer may market quite a range of loans, they all are programs with that lender alone.

Also called a "loan representative" or "account executive," a loan officer represents the borrower to the lender. From selecting a loan to closing, a mortgage banker can guide you through the process. Either a salary or commission is given to mortgage brokers by their employers.