A mortgage broker is a liaison officer or intermediary who helps homebuyers find the best mortgage and lender for their financial circumstances. As a mortgage broker, you'll work with lenders to identify the terms and rates that best suit your client's (the mortgage borrower) needs.
Buying a house can be a complex process, and many buyers aren't fully equipped to identify the right mortgage for them. They may need help understanding timelines, interest rates, fees, and terms. A mortgage broker's guidance can help make the process of buying a home less stressful and easier to navigate.
A mortgage broker's primary responsibility is to educate their clients about different mortgage options and help them choose the best path. However, brokers can serve their clients in the following ways:
There are many benefits to working with mortgage brokers. A mortgage broker provides invaluable insight and expertise and simplifies the process of selecting the best mortgage. They research the different mortgages available to a buyer and provide well-researched comparisons that save a buyer's time and effort. They may introduce borrowers to new lenders or help them disqualify lenders that don't offer a suitable mortgage option. Mortgage brokers can also help clients save money through fee waivers and better loan rates.
Both mortgage brokers and mortgage loan officers support borrowers with their mortgage process. However, they have different duties and responsibilities. The key differences between these parties are as follows:
How mortgage brokers are paid depends on their type of employment. If you join a firm, you may have a monthly salary. However, most independent mortgage brokers earn a commission on each mortgage they help process. Typically, the commission is 1% to 2% of the loan sum. A mortgage broker may be paid by the buyer or the lender, but not both.
Currently, the average mortgage broker salary (Credit Intermediation and Related Activities) in the country is around $85,190, according to the Bureau of Labor Statistics . Pay may be impacted by many factors, including experience, qualifications, or even the state or region you work in. By comparison, the median annual income for a loan officer as of May 2022 was $65,740.
Real estate agents can expand their career and earning potential by providing mortgage brokering services. As a real estate agent, you already understand your client's budget and their needs. By becoming a mortgage broker, you can help them find the right mortgage and enable them to purchase their dream home.
Just as real estate agents take a pre-licensing course and license exam to get their real estate agent license, aspiring mortgage brokers must take pre-licensing training and take the National Mortgage License System (NMLS) Test to be eligible for their mortgage broker license.
Real estate agents generally liaise between home buyers and sellers; a mortgage broker works with mortgage borrowers and lenders. Though these are distinct roles, there are some important facts to bear in mind.
Getting a mortgage brokering license can help real estate agents educate their clients while providing more comprehensive services. You can also further your professional development and serve your clients by becoming a REALTOR®, a member of the National Association of REALTORS®, and adhering to the REALTOR® Code of Ethics. Learn more about how NAR membership can help you build professional networks, access educational and marketing resources, and participate in advocacy initiatives.
