Know what to expect: Mortgage Brokers vs. Loan Officers
Either a mortgage broker or a mortgage banker can help you when you're looking to get a mortgage loan. Since a new home is the outcome of the work of both mortgage broker and loan officer, it's easy to confuse the two. Yet it will be helpful to recognize the difference between the two jobs so you know what to expect from them as you enter the mortgage application process.
About Mortgage Brokers
A mortgage broker is an individual or group that is an independent agent for both the mortgage loan borrower and the lender. A mortgage broker facilitates 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 bank, trust company, credit union, mortgage corporation, finance company or even an individual investor. You work with a mortgage broker to examine your financial circumstance and lead you to the lender who has the right mortgage loan for you. Your broker will offer your mortgage application to various lenders, and works with the chosen lender until the loan closes. The borrower gives a commission to the broker at closing.
What is a Loan Officer?
The biggest difference between a mortgage broker and a loan officer is that the latter is employed by a lending institution (a bank, credit union, or others) to offer and process loans only from that institution. Although a loan officer may market quite a range of loans, they are all products of that lender alone.
Also called a "loan representative" or "account executive," a loan officer represents the borrower to the lender. A loan officer will walk the borrower through the selection, processing and closing of the loan. Loan officers can be paid a commission or salary for their work by their employers.
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