The starting point

A broker helps arrange financing with lenders. A direct lender makes the loan. Compare the actual offer in either case.

Two different roles

A mortgage lender is the institution making the loan. A mortgage broker helps a borrower find a lender or loan and does not itself lend the money. Some financial institutions act in both roles, so ask which role applies to your transaction.

A loan officer often works for a particular lender. A mortgage broker typically works with multiple lenders, but that does not mean every lender in the market is available through that broker.

Source: CFPB: Mortgage lender and mortgage broker differences

Understand the choices being offered

With a direct lender, ask which of its products fit your situation. With a broker, ask which lenders it can work with for your property and loan type. In both cases, ask who will process the application and keep you updated.

  • Are you acting as a broker or a lender on this loan?
  • Which lenders or loan programs are you considering?
  • Who will make the lending decision?
  • Who is my contact if the application needs more information?

Ask how the person is paid

Loan officers and brokers may receive compensation paid by the borrower or the lender. Ask what fees apply to your loan, who pays them, and how they appear in the offer. Do not assume that one business model automatically costs less.

Source: CFPB: How mortgage loan officers and brokers get paid

Compare the loan, as well as the relationship

The CFPB recommends shopping around whether you use a broker or a direct lender. Compare rates, fees, terms, and communication before choosing. The provider label is a starting point for questions, not a quality rating.

Source: CFPB: Mortgage lender and mortgage broker differences

Sources & editorial note

Published by Mortgage Firm. Sources checked September 28, 2026. This content has not been professionally reviewed and is general education, not a loan offer or a personal recommendation. Confirm current details with your lender.

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