Know what to expect: Mortgage Brokers vs. Loan Officers
When it comes to locating a mortgage loan, you should know the difference between a mortgage banker and a mortgage broker. Because a new home is the outcome of the work of both mortgage broker and loan officer, people often confuse the two. Yet it is important to know the ways they differ so you have clear expectations of them as you enter your mortgage process.
What is a Mortgage Broker?
A mortgage broker is someone or group that serves as an independent agent for the mortgage loan borrower as well as the lender. Your mortgage broker will stand as facilitator between you and the lending institution; which may be a credit union, bank, trust company, finance company, mortgage corporation or even an individual, private investor. You use a mortgage broker to analyze your financial circumstance and find the lender who has the right loan for you. Your broker will submit your loan application to various lenders, and works with the lender of choice until the loan closes. The broker receives a commission from the borrower upon closing.
About Loan Officers
Lending Institutions (banks, finance companies, and others) employ loan officers to offer, and process loans originated by that specific institution alone. While a loan officer may offer quite a range of loan programs, they are all programs from that specific lender.
Also called a "loan representative" or "account executive," a mortgage banker represents the borrower to the lender. From finding a loan program to closing, a mortgage banker can guide you through the process. Mortgage bankers may be given a commission or salary for their work by their employers.
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