The mortgage industry is booming, in spite of the pandemic. It’s a buyer’s market, with overburdened landlords looking to downsize their investment properties and stabilize their personal finances. Real estate is one of the most heavily audited market trends that indicate an upswing or downturn in the economy, and while brokers may have the most visibility, there is another silent partner in every house sold across the United States. Say hello to the mortgage loan officer.
What does a mortgage loan officer do?
Mortgage loan officers typically work for a financial institution directly, as the primary point of contact between prospective homeowners and the bank. They audit applications for creditworthiness and negotiate competitive interest rates on behalf of the lender based on the current Federal Reserve rate. They are quite often the folks that will make or break a sale, as without the mortgage securing the purchase, many sellers move onto other buyers. Mortgage loan officers not only evaluate credit, they offer prospective homeowners information on how to become more credit savvy and write up the contract, and set clauses that the bank and the buyers should agree to.
Because of the gravity of the transactions they facilitate, this arm of the financial industry is governed under the SAFE Act to ensure that unscrupulous business practices are nipped in the bud before someone loses their life savings. Fingerprinting, background checks and be required to join the National Licensing System and Registry (NMLS) are just a few of the prerequisites. Potential mortgage loan officers also have to pass the national certification exam and sit through 20 hours of mandatory education on ethical best practices.
An entry-level candidate can become a licensed mortgage loan officer with a high school diploma or a GED, although more and more employers are gravitating towards candidates with a degree in finance from a 2 or 4-year college as the market becomes more competitive.
Are mortgage loan officers in demand?
Surprisingly, people don’t line up for the position of mortgage loan officers. Perhaps because these individuals themselves have to be extremely credit-worthy. Or perhaps it is because more finance majors are graduating college and heading into more fiscally stable positions as accountants and healthcare administrators. Whatever the reason? Becoming a mortgage loan officer is a position that is in high demand. There simply aren’t enough qualified candidates to fill the available positions, making this a great time to consider this worthy career.
Do loan officers make commission?
Mortgage loans are offered by the bank or financial institution based on the credit score, debt to income ratio of the buyers and the valuation of the property. Similarly to real estate brokers, mortgage loan officers DO make a modest commission on the closing of a home loan. The institution generally charges closing costs, which are paid as fees for the service of the financing bank or lender. A percentage of these closing costs go to the mortgage loan officer as a bonus for productivity, because banks are more vigorous when they are actively lending money to patrons.
However, the bonus is not their entire salary. An entry-level position as a mortgage loan officer currently has a base salary of $27,000 annually, and when combined with the productivity bonuses from peak performance, can add up to quite a tidy sum. Like any commission-based position, there is a significant amount of training and skill-building that is required to hold the title of a loan officer. Salary and bonuses will also depend on the location of the financial institution, as well as the size of the transactions the bank is authorizing.
Is a mortgage loan officer a good job?
For the self-starting, highly motivated candidate who has had some experience in commission sales practices, or who is a newly minted finance degree holder? The position of a loan officer is a good one to leverage your skills and develop relationships within the community you serve. Mortgage loan officers don’t just sell the home or office space--they continue to interact with the purchaser after the sale is complete and the real estate agent has moved on.
Being financially savvy with a compassionate outlook and good interpersonal skills will make you a fantastic candidate for this job. As you build your reputation with clients and patrons of the bank or lending institution you serve, word-of-mouth referrals will keep a steady stream of base and commission paychecks flowing into your own bank account. And you get the satisfaction of knowing you are assisting others in the purchase of their dream, whether it’s a family abode or a small bistro on Main Street.
If you are looking for an exhilarating career in an industry that has become synonymous with the American Dream? Look no further! Become a mortgage loan officer and start building long-term relationships with your prospective clients and neighbors. We promise you won’t regret it. Be sure to check out the amazing books and links below for more information on how YOU can help make homeownership a dream come true for hard-working Americans.