Broker vs. Loan Officer

Mortgage Broker vs. Loan Officer:

When you're looking to get a mortgage loan, you may be faced with a decision of whether to work with a loan officer of a credit union or bank or to work with a mortgage broker.  People often confuse the two job types even though both will glean the same results: a new home. However, it is important to understand the difference between the two types of jobs so you know what to expect from them from start to finish of the mortgage loan process.

 

Our Mortgage Broker is an individual that acts as an independent agent for both the borrower and the lender of a mortgage loan.

 

Mortgage brokers are the middle man between you and the lending institution.  A mortgage broker will analyze your financial situation to determine which lender is the best fit for your loan needs. She will submit your mortgage application to the best fit lender for your needs and works with you and the lender until the loan closes. The mortgage broker is compensated either directly by the lender or by the borrower but never both. In most cases the broker is compensated by the lender.

 

A loan officer is a representative of a lending institution, such as a credit union or bank, who works to originate your loan and then passes the loan process off to one or more individuals to process causing it to go through too many hands which can lead to much confusion and cause for you to provide documentation over and over again.  The loan officer can only originate loans from that specific lender limiting your choices.  The loan officer is paid whether the transaction closes or not through their payroll channels whereas the mortgage broker is like a Realtor and is not compensated until your loan has closed.

 

Your choice between the two is vital for you to experience a smooth loan process from start to finish.