What is the difference between a Broker and a Banker?

Recently I was at an Anna Maria Island Chamber of Commerce event and I was asked this question.  There are many distinct differences.

  1. Definition of Broker.  The dictionary defines “broker” as a person who arranges or negotiates a settlement, deal or plan.  That’s the nutshell.  You’ve heard of a Mortgage Broker, Insurance Broker, Real Estate Broker and Stock Broker.  We are all middlemen offering a valuable service to find and negotiate the best deal in our respective focus areas.
  2. I’m an expert in mortgages.  I am required to be licensed, educated and complete continuing education classes on a yearly basis. Loan Officers at banks are typically not required to be educated in finance nor do they need to complete continuing education or be individually licensed because they are covered under the banks umbrella license.
  3. You talk, I ask questions and listen to get details of your financial situation so that I can research my lenders to find the program that will give you the maximum benefit for your position.  A bank is limited in what they can offer as they only have their own in-house loan programs.
  4. I am available 24/7 for questions.  Bankers have, well, banker’s hours.
  5. Every question you have about a mortgage is important and deserves a transparent, honest and correct answer.  Every client deserves respect for asking questions about their mortgage.  It’s your money and you deserve to know the details of how it is being spent.  I believe in educating the client which means addressing and/or researching every question, every fear, and every uncertainty.  Will a bank give you that amount of time and dedication?

The above is to illustrate the difference between mortgage broker and banker. There are very good banks out there.  I have relationships with a few banks that give great service for the loan products they offer.  Typically those programs are not generally available in the wholesale market.  Also, there are certain circumstances in a client’s financial position where I will admit when the bank’s program is a better deal than what I can find.  My focus is on the client’s best interests.  And that’s the bottom line.