Know what to expect: Mortgage Brokers vs. Loan Officers

When it comes to locating a mortgage , you should know the difference between a mortgage broker and a loan officer. Because both reap the same result (a new home), people usually confuse the two job types. But for the application process, it will help if you recognize how they are different.

About Mortgage Brokers

A mortgage broker (either a company or an individual) is an independent agent for both the mortgage loan borrower and the lender. Your mortgage broker will stand as coordinator between you and the lending institution; which can be a credit union, bank, trust company, finance company, mortgage corporation or even an individual investor. A mortgage broker will analyze your numbers to find out which lender is the right fit for you. Your broker will submit your mortgage loan application to various lenders, and works with the chosen lender until closing. The broker gets a commission from the borrower upon closing.

Loan Officers

Mortgage Bankers are representatives of a particular lending institution (such as a bank, credit union, etc.) who process mortgages and other lending programs for their place of employment alone. They may be able to market loans to fit many different situations, but all the loans will be products of the same lender.

Also called a "loan representative" or "account executive," a mortgage banker represents the borrower to the lending institution. From selecting a loan product to closing, a mortgage banker will walk a borrower through the process. Either a salary or commission is given to mortgage brokers by their employers.