Last reviewed: 16 September 2026

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Table-funded loans: who's actually on the hook, explained

Our broker vs. loan officer vs. correspondent lender explainer covers the basic roles. Table funding is the specific mechanical arrangement that determines who's legally answerable when something on a broker-originated loan goes wrong.

What table funding actually means

RESPA's implementing regulation defines table funding as a settlement at which a loan is funded by a contemporaneous advance of loan funds, and is assigned, at or immediately after settlement, to the party that advanced those funds. In plain terms: a mortgage broker closes the loan in its own name at the closing table, but the money never actually comes from the broker's own balance sheet — a separate funding lender wires the funds and takes assignment of the loan essentially simultaneously.

Why the "creditor" label doesn't simply follow the money

TILA and Regulation Z don't ask who advanced the cash — they ask who the debt is initially, legally payable to under the loan documents. A table-funding broker that closes a loan in its own name is generally the entity actually named as creditor on the note, which is what triggers its own TILA disclosure obligations at consummation, distinct from the funding lender that shows up on the assignment a moment later. Regulation Z's own commentary specifically addresses table-funded transactions on exactly this point: being named as the creditor carries the disclosure duty, regardless of whose money physically funded the loan.

The real-world liability gap this can create

This distinction matters to a borrower for a concrete reason: if a TILA disclosure error, an unlicensed-lending issue, or a RESPA violation surfaces later, the entity nominally on the hook as "creditor" is often a much smaller company than the funding lender that actually put up the money and now owns the loan — and a smaller broker entity can be a much harder target to actually collect a remedy from than the well-capitalized lender the loan was assigned to. This is also why Regulation Z's loan originator compensation rule (see our explainer) specifically defines a "loan originator" to include a creditor that makes use of table funding by a third party — closing the loophole that would otherwise let a table-funding broker's steering incentives escape the same compensation rules that apply to a broker who never touches the funds at all.

What to actually check

NMLS Consumer Access will show which entity is licensed as the actual originator on your loan, regardless of how it was funded — see our NMLS verification guide. The practical takeaway isn't that table funding itself is improper — it's a completely ordinary, legal part of how many broker-originated loans work — but that knowing which name is actually on your note as creditor, not just who serviced or funded it, is what determines who you'd need to pursue if something goes wrong.