In the past, prospective home buyers turned entirely to their banks (the institution where they kept their savings and checking accounts) for their mortgage needs, but you now have more options at your clearance with the rising presence of mortgage brokers. However, there is no doubt that banks and credit unions still have a large market share for mortgage origination.
Although, A mortgage banker and broker, both can help you get a home loan. Because of both having the same jobs, the federal Bureau of Labor Statistics lists both as “loan officers” with similar functions and pay.
Mortgage banker is a company, individual or institute that originates mortgages. To fund mortgages, these institutes and company can use their own fund or borrow funds from a warehouse lender. A primary business of a mortgage broker is to earn the fees associated with loan origination. That person is a direct lender, work for a bank or an institute that actually provides you the money for a loan.
Mortgage Brokers are federally licensed firms or individuals who offer loan programs on behalf of lenders. They don’t represent single institution, as it works with many to shop for a loan for a specific individual. Broker act as a middle man between you and a number of different lenders. Most of mortgage brokers are paid by the lender. Brokers tend to be even smaller and more localized. Usually, only one or two people operate the brokerage company, and all the products they offer are coming from banks or mortgage bankers.
Whenever you look for your first loan, you have the rights to choose the best option for you according to your choice and need. You can frequently make this process easier by differentiating lender and brokers, and simply ask them what they can offer and at what price.