You’ve spent time doing your research and the time has come for you to find a lender for your mortgage. However, in said research, you have come across two terms that seem a bit similar: mortgage bankers and mortgage brokers. What exactly is the difference between them, and how can they help you? In today’s blog entry, we’ll be answering just that.
Bankers: Work in Financial Institutions
A mortgage banker works in the loan department of a financial institution. Mortgage bankers lend the bank’s money, and since they are at a financial institution, they have access to your banking information like your checking and savings, meaning they are able to have a pre-existing relationship with you—especially if you are loaning from your personal bank.
Because they work for a financial institution, mortgage bankers have their own individual loan programs. So, if you determine that their programs are not right for you, you will have to shop around at other lenders to find the right fit.
Brokers: Work with Multiple Institutions
On the opposite end of the spectrum, Mortgage brokers have no direct ties to any singular financial institution, meaning they’re able to work with multiple lenders. As such, they are responsible for finding you the best loan that will work for you. Unlike mortgage bankers, brokers do not lend their own funds but act as the middlemen between you and the bank.
Brokers represent you, the borrower, and are paid on commission or via flat fees that are a percentage of the value of the loan you take out. If you choose a mortgage broker, understand that you will have to start a relationship with them from scratch so there may be a little extra legwork so they can understand your needs. If you choose a mortgage broker, like with all lenders, remember to check for hidden fees that could inflate the cost of your loan.
In conclusion, while the names may seem familiar, the differences between mortgage brokers and mortgage bankers are notable. At Mortgages Done Right, we strive to work with you to help get the money you need to help finance the home that you desire, with a variety of loan plans to choose from. We hope that this blog entry was informative, and if you have any further questions, please engage us further in the comment section or contact us if you have any questions about what we do. From all of us at Mortgages Done Right Inc., thank you for reading and have a lovely day.