Mortgage Broker or Mortgage Banker

When you're looking to get a mortgage loan, you need to know the difference between a loan officer and a mortgage broker. Since both a mortgage broker and lending officer can help you buy a new home, it's understandable to confuse them. Yet understanding how they differ will be advantageous to your mortgage process.

Mortgage Brokers

During the mortgage loan process, an individual or company who is an independent agent for both mortgage loan applicant and lender is a mortgage broker. 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. A mortgage broker can look at your numbers to determine which lender is the right fit for you. From application to closing, your mortgage broker works with you: offering your mortgage application to several lenders, and coordinating the process with the lender through to closing. At closing, the broker's commission is given by the borrower.

What is a Mortgage Banker?

Loan officers represent a specific lending institution (such as a bank) who work with mortgages and other loan products on behalf of their company alone. They may be able to offer loans to fit many different situations, but all the loans are products of the same lender.

Also called a "loan representative" or "account executive," a mortgage banker acts of behalf of the borrower to the lender. The borrower is guided through the entire process, from selecting the loan to closing, by the loan officer. Lending institutions pay their loan officers a salary or commission.

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