Mortgage Broker vs. Direct Lender

When you're looking to get a mortgage loan, you may work with a loan officer at a lender/bank or you may choose to work with a mortgage broker. People often confuse the two job types since both offer the same results: a new home. However, it is important to understand the difference between the two types of jobs so you know what to expect from them during the mortgage application process.

    A MORTGAGE BROKER is an individual or firm that acts as an independent agent for both the borrower and the lender of a mortgage loan. Mortgage Brokers work with many of the local lenders you would go to, and can usually offer you the same, if not better interest rates than the lender would offer you in a retail branch.  Mortgage Brokers do most of the work for the lender, allowing them to save money on the costs of "making" a loan, which directly reflects back into the rates you get from the Broker.

    Mortgage Brokers are the contact people between you and the lending institution, which can be a bank, trust company, credit union, mortgage corporation, finance company or even an individual private investor. A mortgage broker will analyze your financial situation to determine which lender is the best fit for your loan needs. They place your loan application with one or more lenders and works with the chosen lender until the loan closes. He or she receives a commission from the bank for placing the loan with them, or may collect points from the borrower when the loan closes.

    A lending loan officer is a representative of a lending institution, such as a bank, who works to sell and process mortgages and other loans originated by their employer. They often have a limited variety of loans types to draw from; all originate from that specific lender. A loan officer gets paid the same way, either on a per loan basis or by charging points.

    Also known as a loan representative or account executive, loan officers represent the borrower to the lending institution and will guide him or her through the selection, processing and closing of mortgage loan. Loan officers can be paid a commission or salary for their services.

    The benefit of working with us as a Mortgage Broker is that we have the interest rates and programs from many different lenders, not just one.  Rates chage daily, and we can make sure we match you with the right lender on any given day you decide to lock your loan.  You are also guaranteed our personal service, including DAILY updates as to where your loan stands (either through email or a direct login on this website); working with a rep from a lender directly will probably leave you wondering what is going on most of the time.

Please contact us to discuss what we offer you making us a better choice than a direct lender (or another broker).  And if you ever would like to speak with the Managing Broker here, you can reach him directly at extension 111.