The difference between a Bank and Mortgage Broker

The mortgage experts at a bank, credit union or other lending institution are employees who work to sell products and mortgage programs that are available from their employer. They often have a large number of loan types to choose from but all of the loans come from the same lending institution.

A mortgage broker is a professional who is paid a fee to bring a borrower and a lender together. They work with many lenders as freelance agents and scout out the best possible loan for your situation.

Local banks often understand the local real estate market better whereas distant lenders may delay closing until questions are answered. However, mortgage brokers can often find a lender that makes loans that the bank refuses. Banks tend to lean more towards the conservative side of lending and often have tighter criteria then some of the options that a Mortgage Broker can find.

Either way the most important decision for a buyer is the rate, terms and closing costs. Work with someone who will give you the best service and the best deal.