Loan Broker Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Loan Broker, written in plain English, along with examples of how it is used.
What is Loan Broker?
Middleman who brings together borrowers and lenders.
History and Meaning of Loan Broker
A loan broker is a financial professional who brings together lenders and borrowers through the intermediary of a brokerage. These financial professionals have been around for decades, and they act as links between loan applicants and lenders.
As middlemen, loan brokers help clients find the best financing option for their specific needs. They work with a wide range of lenders and banks to offer options, including conventional loans, government-backed loans, and specialty lending options.
A loan broker performs various tasks to help applicants secure loans, including credit checks and the collection of various financial and personal information. They also compare loan options, rates, and terms to present applicants with the best financing opportunity.
Examples of Loan Broker
John is a loan broker who helps borrowers find suitable lenders for their mortgage. He assesses each applicant's financial profile and independent objectives before seeking out lenders that can accommodate their precise needs.
Maria needs a personal loan to consolidate her debts, but she doesn't have great credit. Therefore, she approaches a loan broker to help her find a suitable lender that can offer her a loan with a low-interest rate and favorable repayment period.
Brandon owns a business and is seeking a loan to expand it. He has limited knowledge of commercial lending and therefore seeks the assistance of a loan broker. The broker will help Brandon explore different financing options, provide advice on the best loans for his business, and connect him with reputable lenders.
Legal Terms Similar to Loan Broker
- Mortgage Broker: A third-party that brings together borrowers and lenders, specifically for the purpose of mortgage financing.
- Loan Officer: A professional who works for a lending institution and helps loan applicants with the collection of financial and personal data.
- Credit Counselor: A professional who helps consumers evaluate their credit and make effective decisions to improve it.