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A Mortgage Broker is a company or individual that charges
a commission and brings together lenders and borrowers for
the purpose of loan origination. The primary function of the
Mortgage Broker is to ensure that the borrower finds a perfect
match in the form of an ideal lending institution. The deal
should be such that it not only benefits the borrower but
also represents a solid and good investment for the lending
institution.
A loan officer works directly for the mortgage loan company.
The function of the loan officer is to take in the applications
and ensure that the borrowers are well-educated about the
nature of the loan and are clear about the financing process.
The rules and policies for obtaining a mortgage broker license
differ from state to state. Each state has its own statutes,
rules and regulatory agency that govern the mortgage industry.
Most states require that mortgage brokers obtain a valid license
before they can operate their mortgage brokering business.
It is imperative that you find out the rules and regulations
pertaining to specific education or experience requirements,
insurance, net worth, and other data in your state for obtaining
a mortgage broker license.
How are mortgage brokers different from mortgage
bankers?
Mortgage banker is the lending institution whereas mortgage
broker works as an agent of a number of lending institutions.
A mortgage banker is the lender, the one making the loan directly.
When you approach a mortgage banker, you will get a list of
mortgage loans and schemes from that particular banker only.
Whereas the responsibility of a mortgage broker is to find
the mortgage loan that best meets the criteria of the borrower
from a pool of mortgage loans. The difference is the number
of choices you get when you choose a mortgage broker. If you
are confident about the mortgage banker and the schemes offered
to you and have made up your mind that you want a particular
mortgage banker to finance your loan, then you do not require
the services of a mortgage broker. The broker does everything
that the lender or a mortgage banker is expected to do, such
as checking your financial records, personal history and so
on. But once your loan application is compiled along with
required data, the broker will select a suitable mortgage
lender that is most likely to accept your application based
on your financial and personal information.
What skills are expected from a mortgage broker?
If you are looking for a job at a mortgage brokerage firm
or mortgage lending institutions, ideally you should have
the following skill sets:
• A college degree or equivalent
• Previous experience in either mortgage industry or
sales industry is recommended. Any experience in a non-mortgage
industry should prove that the individual is able to utilize
the experience for the mortgage origination.
• Excellent communication and inter-personal skills
• Computer word processing skills along with typing
skills and the ability to use the Internet is a plus
Mortgage brokers and loan officers earn their income mainly
through commission. The amount of commission received by the
broker is based on the volume of loans made and the overall
performance of the broker. A number of mortgage brokers start
their own companies after gaining considerable experience
with a reputed mortgage brokerage or lending firm.
Related Mortgage Career Topics:
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