Know what to expect: Mortgage Brokers vs. Mortgage Bankers
When you work on your application for a mortgage , you need to know the difference between a mortgage broker and a mortgage banker. Because both a mortgage broker and mortgage banker can help you fund your new home, people frequently confuse them. But for your application process, it can benefit you if you recognize they ways they differ.
About Mortgage Brokers
A mortgage broker (either a group or an individual) is an independent agent for the mortgage loan applicant as well as the lender. Your mortgage broker will stand as coordinator between you and the lending institution; which can be a bank, trust company, credit union, mortgage corporation, finance company or even a private investor. A mortgage broker will examine your finances to find out which lender is the right fit for you. You give your mortgage loan application to your broker, who offers it to a number of lenders. Your mortgage broker then assists your work with the lender of choice until closing. The broker is given a commission from the borrower at closing.
About Mortgage Bankers
Mortgage Bankers represent a particular lending institution (such as a bank) who work with mortgages and other loans on behalf of their place of employment alone. They may have the ability to market loans to fit a variety of situations, but all the loans are products of the same lender.
Also known as a "loan representative" or "account executive," a loan officer represents the borrower to the lending institution. The mortgage banker will guide the borrower through the selection, processing and loan closing. Mortgage bankers will be paid a commission or salary for their services by their employers.
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