The difference between a loan officer and a mortgage broker

What is the difference between a loan officer and a mortgage broker? A loan officer is a person, the sales broker working for a mortgage loan under license. In many states, a loan officer is not required to be authorized.

A mortgage broker is not licensed, and can be highly regulated, as far as how and where they carry out their activities, and how to advertise. The Department of various states' of Banking also looking forMortgage fraud complaints and tough. mortgage brokers admit that their state banking department to inspect their books and records of the hours during normal business hours. They sometimes have on certain equity requirements are, and must have sufficient capital for office expenses and marketing.

As a loan officer, usually up to 50% net of fees collected are paid on a loan. The fees usually find the front and back-end pointscharged on a loan. The up-front points are paid separately by someone buying a home, or on a refinance they can be included in the new loan amount. If included in the new loan amount, they do become a part of the new loan balance and must eventually be paid back. Back-end points are paid courtesy of the lender, and are funded from an interest rate that is higher than the broker's wholesale rate, or "par" rate. These points are not paid back directly by the borrower. For example, if a Loan is $ 200,000 and there are two points in the rear, is the broker will receive $ 4,000 from the lender. The borrower can sell the house or refinancing the loan at any time and we do not have $ 4,000. The premiums on interest rates are much more favorable prices are like an insurance policy. Lenders know how long the average loan stay on their books, so you know what media they will get involved in order to cover the extra pay respects to a broker.

One advantage of being a loan officerwho can work flexible hours, and not everyone in the office. You can choose from meetings with bankers, businessmen and other referral sources. You can hang with flying or meeting prospects. You can make calls to the phone, or online applications to take from a website. In many cases you can work from home, depending on what your broker needs regarding the coverage of the phone.