Mortgage Broker vs. Loan Officer

Either a mortgage broker or a loan officer can assist you when it's time to get a mortgage loan. It's easy to confuse the two since both will give the same outcome: a new home. But as you begin your application process, it can benefit you if you understand they ways they differ.

What is a Mortgage Broker?

A mortgage broker (either a group or an individual) is an independent agent for the mortgage loan borrower as well as the lender. Your mortgage broker will stand as facilitator between you and the lending institution; which may be a bank, trust company, credit union, mortgage corporation, finance company or even a private investor. You partner with a mortgage broker to analyze your financial situation and lead you to the lender who has the best loan for you. Your broker will submit your mortgage application to a handful of lenders, and works with the chosen lender until closing. At closing, the broker's commission comes from the lender or borrower.

What is a Loan Officer?

The most important difference between a mortgage broker and a loan officer is that a loan officer works for a lending institution (a bank, credit union, or others) to promote and process loans solely originated from that institution. While a loan officer may offer quite a variety of loans, they all are programs from that lender alone.

Also known as a "loan representative" or "account executive," a loan officer acts of behalf of the borrower to the lending institution. The loan officer can help you through the selection, processing and loan closing. Loan officers may be given a commission or salary for their services by their employers.