Mortgage Broker vs. Mortgage Banker
When it's time to get a mortgage , you should know the difference between a mortgage broker and a mortgage banker. Because both a mortgage broker and mortgage banker can help you buy a new home, people often confuse them. Yet it will be helpful to recognize the ways they differ so you know what to expect from them during the mortgage process.
About Mortgage Brokers
A mortgage broker (either a company or an individual) is an independent agent for both the mortgage loan applicant and the lender. 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 a private investor. Which lender has the mortgage loans that is best for you? A mortgage broker will help you find the best one. You deliver your loan application to your broker, who presents it to a number of lenders. Your mortgage broker then helps you work with the lender chosen until the closing of the loan. The broker receives a commission from the borrower at closing.
What is a Mortgage Banker?
The main difference between a mortgage broker and a mortgage banker is that the latter is employed by a lending institution (a bank, credit union, or others) to process loans only from the products of that institution. There can be a wide range of loans types to draw from although all are programs of that specific lending institution.
Your mortgage banker will represent you to the bank or other lending institution. The borrower is guided through the whole process, from loan selection to closing, by the loan officer. Either a salary or commission is given to mortgage brokers by their employers.
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