Know what to expect: Mortgage Brokers vs. Loan Officers

Either a mortgage broker or a loan officer may work with you when you work on your application for a mortgage loan. Since both glean the same result (a new home), people frequently confuse the two. Yet it is important to know how they differ so you have clear expectations of them during the mortgage application process.

Mortgage Brokers

During the mortgage loan process, an individual or firm who is an independent agent for both mortgage loan applicant and lender is a mortgage broker. A mortgage broker facilitates things between you and your lender, which can be one of the following: a credit union, bank, trust company, finance company, mortgage corporation or even an individual, private investor. Acting as a facilitator between you and your lender, your mortgage broker can match you with a credit union, bank, trust company, finance company, mortgage corporation or even an individual, private investor. Which lender offers the loan that is right for you? A mortgage broker will lead you to the best one. Your broker will offer your loan application to one or more lenders, and works with the chosen lender until closing. The broker receives a commission from the borrower upon closing.

About Loan Officers

Lending Institutions (banks, finance companies, and others) employ loan officers to promote, and process loans solely on behalf of that particular institution. They may have the ability to market loans to fit a variety of situations, but all the loans are products of the same lender.

A loan officer (also known as an "account executive" or "loan representative") represents the borrower to the lending institution. From selecting a loan product to closing, a loan officer can help the borrower through the process. Either a salary or commission is paid to loan officers by their employers.