What Is the Job of a Loan Officer?
If you have ever thought about purchasing a home, one of the main things that may go through your mind is “what is the job of a loan officer?”
A loan officer usually works for a bank or a mortgage company that specializes in mortgage loans.
A loan officer is a financial liaison that helps people and businesses get the funding that they need from a lender. They usually specialize in either commercial or individual mortgage loans, although they can also handle other types of credit such as personal loans.
A loan officer will typically spend some of his day searching for potential clients to service via making cold calls. They may also use a list to work from in order to make contact with potential customers.
Once a loan officer has secured a client, most of the time, people think of loan officers as their personal liaison between a commercial or home loan lender and the borrower. The loan officer may have a group of financial representatives or banks and lenders that they can reach out to when trying to seal the deal and secure a loan for borrowers.
The core job of a loan officer is to help borrowers get the loan that they need, whether it is for a home or business. A loan officer may also:
- Pre-qualify buyers for loans in certain instances
- Help borrowers complete their applications
- Run credit checks
- Advise clients on how they can get the loan they need
Qualifications of a Loan Officer
Usually you will find that a loan officer has a Bachelors degree in either business, finance or economics. Some may even have banking experience. On occasion you may even find a loan officer who has a solid background in mathematics.
The daily duties of a loan officer vary and include:
- Constant communication with the client and the lenders either via the telephone or over the Internet
Traveling to the client or lender
- Visiting customers
- Drafting paperwork
- Perform online credit checks
- Draft correspondence
Having a job as a loan officer will definitely require an ambitious mindset, a penchant for hard work, determination, and the ability to thrive in all environments. There will be times when the pressure is high as well as times where the work day is slow.
As a loan officer you have to have that special something that makes people want to say yes to you. It is important to be a good salesperson, because for every 100 “nos” you will get at least one “yes.” Loan officers live by the law of averages and make every effort to get their customers the loans necessary for their needs. You will find that most loan officers are eager and determined to get their jobs done effectively.
Source: YourDictionary
Loan Officer at Banks and Mortgage Brokers
Loan Officers
We'll give you the average profile of a loan officer working for a mortgage broker. Knowing this may give you an insight on the guy that has your life savings in his/her hands. The average loan officer:
- Has no college degree, may never have finished high school.
- Makes about $1,500/month (about $500/loan) for which they typically work like dogs.
Spends their day getting rejected while looking for business: visiting real estate offices, cold calling customers, going to banks looking for rejected loans, sending out mailers.
- Gets viciously yelled at by borrowers, title companies, realtors, builders, underwriters, and his/her boss. This is part of the day, no matter how good a loan officer is.
Loan Officers are are heavily involved in one of the biggest purchases a person makes in a lifetime, and everything about the deal looms large and frightening for the borrower. Mild mannered people turn in to screaming monsters if anything goes wrong, and there are so many things that can hold up a loan. It's not a fun business, it's stressful, hard work, and it's a good day if no one gets upset with the loan officer. Have a heart for these guys. And also realize that most of them don't respond to yelling, hysterics or threats. It's nothing new to them and will only get you an increase in loan fees as compensation for your abuse or get you terrible service. They're people, too.
If you have less than perfect credit or a tough situation, the loan officer specializing in these non-conforming loans knows he or she will work harder for this deal and will either:
a) hope you will be impressed enough to send many referrals in the future, or
b) charge you more money.
Guess which one they will usually pick? The loan officer sees an opportunity to make a little extra income. Remember the real costs involved in doing a loan.
You should keep in mind that if you can't get an 'A' loan, the loan officer may only be able to find a loan for you which is certainly higher in interest rates, and possibly in fees, too. There are special loans for non-conforming situations.
Especially with tough or non-conforming loans, the loan officer may charge extra points to get the loan through. How much extra is their call (and yours; you can always walk away.) However, overcharging isn't the norm: Loan officers with clients who feel they've been overcharged don't get repeat business, the real money in this industry. Unfortunately, you still need to be careful about the guy who will shaft you. Desperate people can get taken because they'll do anything to get a loan.
If you think you're being overcharged, shop. Most brokers have access to the same products (meaning they can usually find and buy the same loans as other brokers), so call around and compare interest rates and fees, especially if you're not an 'A' loan. Don't believe the loan officer who tells you that you won't get a loan anywhere else. By shopping around, you can usually reveal who's trying to gouge you. Once you find the interest rate and fees you can live with, fill out an application at the broker's office, and lock the terms of the loan.
A broker is your only option when:
- you have less than perfect credit
- are self employed (and can't prove your income)
- just switched professions
- or have a high debt load
Mortgage brokers can get you a loan when the banks just aren't interested in the hassle. But you will pay more in both fees and interest rates for getting your loan through.
A bank is the best option if:
- you have top notch credit
- steady job/work history
- low debt loads
- are self-employed, but your last 2 years of income tax returns easily prove your income.
A broker may have competitve rates/fees as compared to a bank, so don't necessarily rule out a broker even if you'd qualify for a bank loan.
Source: CreditInfoCenter
