Mortgage Broker and Mortgage Banker
When you work on your application for a mortgage , you should know the difference between a mortgage broker and a mortgage banker. Since both give the same result (a new home), it's easy to confuse them. Yet it is valuable to know the difference between the two jobs so you have clear expectations of them during your mortgage process.
What is a Mortgage Broker?
A mortgage broker (either a firm or an individual) is an independent agent for the mortgage loan applicant as well as the lender. A mortgage broker facilitates things between you and your lender, which can be one of the following: a credit union, bank, trust company, finance company, mortgage corporation or even a private 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 investor. Which lender has the loans that is best for you? A mortgage broker will help you find the right fit. Your broker will present your loan application to one or more lenders, and works with the lender of choice until closing. If the loan closes, the broker's commission is paid by the borrower.
What is a Mortgage Banker?
The most important difference between a mortgage broker and a mortgage banker is that the latter works for a lending institution (a bank, credit union, or others) to process loans solely from the programs of that institution. While a loan officer may offer quite a variety of loan programs, they will be products with that particular lender.
A mortgage banker (also called an "account executive" or "loan representative") represents the borrower to the lending institution. A loan officer will help the borrower through the selection, processing and closing of the loan. Either a salary or commission is paid to mortgage brokers by their employers.
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