When buying a home, one of the first questions you’ll face is whether to go through a mortgage broker or directly with a mortgage lender. Both can help you get a home loan, but the way they work — and the benefits they offer — are very different. Understanding these differences can help you save money and choose the right partner for your financial goals.
What is a Mortgage Broker?
A mortgage broker is an intermediary who works with multiple lenders to find you the best loan options. They don’t fund the loan themselves but instead shop around on your behalf.
What is a Mortgage Lender?
A mortgage lender is a bank, credit union, or online company that provides the funds for your home purchase. They approve your loan, set your interest rate, and handle the closing process.
Key Differences Between Brokers and Lenders
| Mortgage Broker | Mortgage Lender |
|---|---|
| Works with multiple lenders | Directly provides the loan |
| May find lower rates by shopping around | Rates depend on the lender’s products |
| Paid through lender commissions or borrower fees | May charge origination or underwriting fees |
| Great for first-time buyers or unique situations | Better if you already have a trusted bank/credit union |
Pros and Cons of Using a Mortgage Broker
✅ Pros: Access to multiple lenders, easier comparison shopping, saves time.
❌ Cons: Broker fees, less control over the process.
Pros and Cons of Using a Mortgage Lender
✅ Pros: Direct communication, potentially faster approvals, strong customer relationships.
❌ Cons: Limited loan options, may not always offer the lowest rate.
Which One Should You Choose?
- If you want the lowest possible rate → Start with a mortgage broker.
- If you want a fast and straightforward process → Go directly with a mortgage lender.
- Always compare at least 3–5 offers before deciding.
Common Mistakes to Avoid
- Assuming your bank always has the best deal.
- Not asking brokers how they’re compensated.
- Ignoring mortgage rates today from multiple lenders.
Not sure which option is right for you? Visit our Rates Today page for the latest mortgage rates and explore our Resource Hub for tools to compare lenders and brokers side by side.