Mortgage Broker or Loan Officer

When you need a mortgage loan, you should know the difference between a loan officer and a mortgage broker. Since a new home is the outcome of the work of both mortgage broker and mortgage banker, people often confuse the two job types. But as you enter your application process, it will help if you recognize how they differ.

About Mortgage Brokers

A mortgage broker (either a group or an individual) is an independent agent for both the mortgage loan applicant and the lender. A mortgage broker facilitates things between you and your lender, which can be one of the following: a bank, trust company, credit union, mortgage corporation, finance company or even a private 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. A mortgage broker can look at your numbers to find out which lender is the right fit for you. You give your mortgage application to your broker, who offers it to a number of lenders. Your mortgage broker then guides your work with the lender of choice until closing. The borrower pays a commission to the broker at closing.

About Loan Officers

Loan officers represent a particular lending institution (such as a bank, credit union, etc.) who process mortgages and other loans on behalf of their company alone. Although a mortgage banker may offer quite a variety of loan programs, they will be products with that one lender.

A loan officer (also known as an "account executive" or "loan representative") acts on behalf of the borrower to the lender. A mortgage banker can help the borrower through the application, processing and closing of the loan. Loan officers are given a commission or salary for their work by their employers.