Know what to expect: Mortgage Brokers and Loan Officers

When you're looking to get a mortgage loan, you need to know the difference between a mortgage broker and a loan officer. It's easy to confuse the two because both will reap the same outcome: a new home. However, it will be helpful to recognize the ways they differ so you have clear expectations of them as you enter the mortgage application process.

About Mortgage Brokers

During the mortgage loan process, an individual or group who is an independent agent for both mortgage loan applicant and lender is a mortgage broker. A mortgage broker facilitates things for you and your lender, which can be one of the following: a bank, trust company, credit union, mortgage corporation, finance company or even an individual, private investor. Acting as a facilitator between you and your lender, your mortgage broker can match you with a bank, trust company, credit union, mortgage corporation, finance company or even an individual, private investor. A mortgage broker will consider your financial situation to find out which lender is the right fit for you. Your broker will present your mortgage application to a handful of lenders, and works with the chosen lender until closing. The borrower gives a commission to the broker at closing.

Loan Officers

Lending Institutions (banks, finance companies, and others) employ loan officers to promote, and process loans solely on behalf of that specific institution. There may be a variety of loans types to choose from although all are programs of that particular lender.

A loan officer (also known as an "account executive" or "loan representative") acts on behalf of the borrower to the lending institution. The borrower is walked through the entire process, from choosing the loan to closing, by the loan officer. Either a salary or commission is given to loan officers by their employers.