Mortgage Broker vs. Loan Officer

When you're looking to get a mortgage loan, you may work with a loan officer or you may choose 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 during the mortgage application process.

A mortgage broker is an individual or firm 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 many lending institutions, which can be a bank, trust company, credit union, mortgage corporation, finance company or even an individual private investor. A mortgage broker will analyze your financial situation to determine which lender is the best fit for your loan needs and has a wide variety of loan types to draw from. He or she will submit your mortgage application to one or more lenders in order to service your loan, and works with the chosen lender until the loan closes. He or she receives a commission from the borrower if the loan closes.  Often times, a mortgage broker may also have more tools available to help people optimize their credit as well as mixed-use & commercial financing.

A loan officer that is a representative one lending institution, such as a bank, works to sell and process mortgages and other loans originated by that one employer. They often can be limited to the types of loans that there specific lender has.

Also known as a mortgage consultants, loan representative or account executive, loan officers represent the borrower to the lending institution and will guide him or her through the selection, processing and closing of mortgage loan. Loan officers can be paid a commission or salary for their services.