Mortgage Broker vs. Loan Officer

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Either a mortgage broker or a loan officer may work with you when you need a mortgage loan. As both a mortgage broker and lending officer will help you purchase a new home, people often confuse them. But for your application process, it can benefit you if you understand the ways they differ.

Mortgage Brokers

A mortgage broker is an individual or company that is an independent agent for both the mortgage loan borrower and the lender. Your mortgage broker will stand as facilitate 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 offers the loan program that fits your financial situation? A mortgage broker will lead you to the right one. From application to closing, your mortgage broker facilitates the loan process: submitting your loan application to several lenders, and walking you with the chosen lender through to closing. As a broker, the lender pays our fees. 

Loan Officers

Loan officers are representatives of a particular lending institution (such as a bank) who process mortgages and other loan programs for their employer alone. Although a loan officer may market quite a range of loan programs, they will be programs from that lender alone.  If another lender has better terms, the loan officer may not have access to them.

A loan officer will represent you to the bank or other lending institution. From choosing a loan to closing, a loan officer will guide a borrower through the process. Lending institutions compensate their loan officers with a salary or commission.

Are all "no closing cost" loans the same?                                                                  Some lenders not only offer "no closing cost" loans, but they also offer a "credit" that goes above and beyond the no closing costs.  What does this mean to you?  A lower loan amount or more cash back to you at closing.  Most lenders do not discuss this credit with you, at Budica Financial, most of our loans offer this credit that sometimes can be in the thousands of dollars.  The bottom line is if two lenders are offering the same interest rate with no closing costs, then the one who offers the most credit would be the best terms.

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