A loan officer works for a bank, credit union or mortgage lender and usually only offers the mortgage programs and rates available at that institution. A mortgage broker works on behalf of the borrower to find the best rate and the loan from several institutions. Throughout these steps, a loan officer performs the same role as a mortgage broker. The Big Difference Between Working with a Mortgage Broker and Working with a Mortgage BrokerA loan officer comes first, during the buying phase, when you're trying to find the best deal for a mortgage.
Unlike a mortgage broker who works independently, a loan officer typically works for a company. They are responsible for seeking customers for the bank or credit union and for developing relationships with these customers on behalf of the bank. Simply put, mortgage brokers connect you with direct lenders and loan officers work for direct lenders. Direct lenders are the only ones that actually provide funding, but finding the right lender can be tricky. Our goal is to shed light on the legal framework surrounding mortgage and real estate brokers, their shared responsibilities and the potential disputes that may arise in their professional interactions.
They may specialize in a specific type of loan or may be approved to offer down payment assistance programs that mortgage brokers can't provide. To obtain your license, your mortgage broker must take the classes required by the government and pass a background check and a national exam. Whether you're a potential buyer or seller of a home, or you're facing a dispute involving a broker, it's essential to understand the contrast between mortgage brokers and real estate brokers. As licensed professionals, mortgage brokers know the different types of mortgages available, as well as the mortgage lenders in the market and the fees, contracts and amortization terms they offer.
To the surprise of some, the license that allows you to list on the stock exchange and sell real estate (the traditional activities associated with a real estate agent license) is the same license that allows you to request loans secured by real estate from borrowers or lenders. A mortgage lender is a financial institution, such as a bank or credit union, that originates and facilitates mortgages. You can usually work with a mortgage broker, loan officer, or mortgage lender to guide you through the different stages of the process. Mortgage brokers can help you fill out your mortgage application and recommend the loan agent or lender that best fits your needs based on your income and credit profile.
Because they do business with many different types of mortgage banks, mortgage brokers are familiar with specialized mortgage products and can often offer solutions that a direct lender doesn't have access to. If you know the basic differences between the three types of mortgage professionals: mortgage brokers, loan agents and mortgage bankers, you can find out who can save you the most time and money. They can save you time and money looking for the best deals available to someone with your financial profile, assuming you're honest, good at your job, and have relationships with many different mortgage lenders. Before you start working with a mortgage broker, make sure they are licensed by the Nationwide Mortgage Licensing System and Registry (NMLS), which maintains a database of authorized brokers.
When buying a home and looking for a mortgage, working with a mortgage broker offers several key benefits, as well as some drawbacks. When you have questions about the mortgage process or how to find the best mortgage options, it can be difficult to know who to ask.
