Mortgage broker vs. loan officer. What is the difference between the two? Both work in loans and mortgages, but who are they, and what do they do? They are similar in helping you with your mortgage and going through the process. But their roles are different.

Who is a loan officer

Let us start with our loan officers. They help the borrowers by explaining to them the different options that are available to them. Loan officers also help the borrower with the application process. What does it take to be a loan officer? One must know what his business is. The loan officer needs to know the different products available in the market. They are also aware of the ins and outs of the banking industry.
Loan officers are representatives of the institutions they are a part of. As such, loan officers are the best people to advise on how to proceed with their applications. Loan officers will also assist you as you prepare for your loan application. Once done with your application, the loan officer gives it to the underwriter to gauge your creditworthiness by looking at your credit history, financial documents, and application. When approved, it will be the loan officer who will prepare the papers and the closing documents.
Established banks only work through their loan officers, and mortgage brokers cannot offer the bank’s products. Loan officers can be salaried or paid through commissions, and as they usually work for the financial institution they represent, they can help you by reducing your rates.

Who is a mortgage broker?

Another difference between a loan officer vs. mortgage broker is that the latter can work with different financial companies. They can offer the products of banks, lenders, credit unions, and other entities dealing with mortgage-related activities. The mortgage broker will be like a middle man, connecting you, the borrower, to the different lenders that can best offer you the product that you need.

Mortgage brokers can help you save money on your loan by assisting you with appraisal and origination. Like the loan officer, the mortgage broker will be helping you with the paperwork then he submits it to the lender for approval. Financial institutions accredit brokers, thus, giving the brokers the authority to offer the deals of each institution they represent.

Mortgage brokers earn by commission from the lender or borrower and, in some cases, both. Brokers cannot operate without a license, and because of this, they are duty-bound to clear their fees and commissions to you. Usually, the origination fees run between 1-2% of your loan amount.