Mortgage Broker vs. Mortgage Banker

When you work on your application for a mortgage , you may work with a loan officer or you may choose to work with a mortgage broker. Since a new home is the result of the work of both mortgage broker and mortgage banker, people frequently confuse the two. However, understanding the differences between them will be valuable to the mortgage loan process.

What is a Mortgage Broker?

A mortgage broker (either a company 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 may be a credit union, bank, trust company, finance company, mortgage corporation or even a private investor. A mortgage broker can look at your numbers to find out which lender is the right fit for your loan needs. From application to closing, your mortgage broker facilitates your loan process: offering your mortgage application to several lenders, and walking you with the chosen lender through to closing. At closing, the broker's commission is given by the borrower.

About Loan Originators

Loan Originators aka Loan Officers. The most important difference between a mortgage broker and a mortgage banker is that a loan officer works on behalf of a lending institution (a bank, credit union, or others) to process loans solely originated from the programs of that institution. They may be able to offer loans to fit many different situations, but all the loans are products from the same lender.

Also called a "loan representative" or "account executive," a mortgage banker represents the borrower to the lender. The mortgage banker will help the borrower through the selection, processing and loan closing. Either a salary or commission is paid to loan officers by their employers.

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Contemporary Mortgage Services, Inc

498 Palm Springs Drive Suite 220
Altamonte Springs, FL 32701