When seeking financing to buy a home, many homeowners work with either a mortgage broker or a mortgage banker. While the terms are often used interchangeably, brokers and bankers play different roles in the mortgage industry.
Here is a quick guide to mortgage bankers to help you learn more:
While they have similar names, mortgage brokers and mortgage bankers have very different jobs. A mortgage broker will assist you in finding a good deal on mortgage loans from multiple lenders. A mortgage banker actually originates and funds the loan.
Unlike banks, mortgage brokers are not financing loans themselves — they simply help you choose a loan that best suits you. A lender uses their cash to provide borrowed money, while the broker provides only assistance from the lender to the borrower.
Mortgage bankers usually work for banks in a specific lending department. Their work involves evaluating mortgage applications to determine if a potential borrower meets the financial institution requirements. Some mortgage bankers specialize in a specific type of mortgage, which can be helpful for borrowers with unique circumstances.
Mortgage bankers may also service or sell loans. As a loan servicer, they handle the payment processing aspect of the loan. This can include managing escrow accounts and providing payoff letters.
Some mortgage bankers sell loans to third-party servicers. This gives them a better opportunity to provide loans to additional borrowers, since it frees up their cash on hand.
How do you choose between a mortgage banker and a mortgage broker? There are advantages and disadvantages to both options, and much of the choice comes down to personal preference.
However, understanding the way a mortgage banker works in comparison with how a mortgage broker works will help loan applicants make the best decision for their financial future.
Lind Risden specializes in Martin and St Lucie County real estate, including Stuart, Palm City, Jensen Beach, Hobe Sound, and Port St Lucie, Florida. A member of the Gratulate of Realtor Institute (GRI) she offers 40+ years of sales experience. Additional degrees she holds are Military Realty Professional (MRP), & Senior Real Estate Specialist (SRES).
Her standards are high, integrity foremost. She is recognized within the community as a full-time, dedicated, skilled, and savvy Realtor. Her superior negotiating skills provide OUTSTANDING RESULTS for all of her customers. It is not a job to Linda, it is her passion for helping people find just the right home.
