Many homeowners choose to pair up with a mortgage banker in the process of searching for a good loan. This can be a successful strategy for some. Expert insight is usually valuable. However, you have to make sure there isn’t an underlying agenda. And that’s where knowing the difference between a mortgage broker and a mortgage banker becomes essential.
Mortgage bankers are directly linked to the lending bodies they represent. If you are set on the bank you want to use for your mortgage loan and you already know the kind of loan structure you want, then you don’t need to worry about this factor too much. Many prospective homeowners want to be sure they are being shown the full spread of options when they choose their loan, and a mortgage banker isn’t the best way to do that.
For one thing, mortgage bankers rely on you for their paycheck. They will only show you loans carried by their banks, and they are also likely to fold additional charges into your closing costs. This is how they make their money. Prepare to be sold a product when dealing with a mortgage banker.
A mortgage broker, on the other hand, is not beholden to your commission for their paycheck. They get paid no matter which loan you decide to apply for, and this means they work on your behalf to present all the available options. A mortgage broker will speak to potential lenders and gather information relevant to your specific financial goals.