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:
Mortgage banker vs mortgage broker
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.
Understanding mortgage bankers: What do they do?
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.
Other services & responsibilities
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.
About the Author
Robin Anderson Real Estate
“My Passion is people and relationships and I promise to provide my clients with exceptional service tailored to their individual needs.” -Robin Anderson
Georgia native, Robin Anderson brings her passion for people and her love of homes to work for her clients. She and her husband, Andy, have been married for over 30 years and have two adult children, Ellen and Drew. They currently live in Fulton County, but Robin has lived and invested in properties throughout metro Atlanta as well as helped clients buy and sell. She has been integral to many real estate endeavors including designing and building several custom homes, remodeling homes, subdividing land, managing rental properties, and buying and selling properties. She spent her first 3 years in real estate working with a new home builder, and she has spent the last 6 years working with buyers and sellers in her own community. Robin is highly motivated but sensitive to the fact that buying and selling homes can be an emotional experience, so she makes it a priority to keep clients closely informed throughout the process and strives to produce quick results. She appreciates the opportunity to help her clients navigate the real estate process, and she aspires to deliver quality customer service that is both informative and positive. She is driven to provide outstanding service for her clients and she is focused on building successful and lasting relationships with her clients. This personalized service earns her enthusiastic referrals from clients she is pleased to call friends.Edit
