Know the difference: Mortgage Brokers vs. Loan Officers
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When it comes to finding a mortgage loan, you should know the difference between a loan officer and a mortgage broker. Because a new home is the outcome of the work of both mortgage broker and loan officer, people frequently confuse the two job types. Yet knowing how they differ is useful to your mortgage loan process.
About Mortgage Brokers
A mortgage broker (either a firm or an individual) is an independent agent for both the mortgage loan borrower and the lender. Your mortgage broker will stand as facilitate between you and the lending institution; which may be a credit union, bank, trust company, finance company, mortgage corporation or even a private investor. Which lender offers the mortgage loan that is best for you? A mortgage broker will lead you to the right one. Your broker will offer your mortgage application to various lenders, and works with the lender of choice until the loan closes. The borrower pays a commission to the broker upon closing.
Loan Officers
Lending Institutions (banks, finance companies, and others) employ loan officers to market, and process loans originated by that specific institution alone. They may be able to offer loans to fit a variety of situations, but all the loans will be programs of the same lender.
A loan officer (also known as an "account executive" or "loan representative") acts on behalf of the borrower to the lending institution. From finding a loan to closing, a loan officer will help you through the process. Either a salary or commission is given to loan officers by their employers.
