Loan Officers
Additional Information
Duties
Typical loan officer tasks include:
- Contact firms or individuals for a loan.
- Interview borrowers to learn about their financial status and address their questions.
- Explain the different possibilities available to applicants when applying for a loan.
- Check potential hires' credit scores and salaries.
- Examine all loan agreements to ensure they meet all federal and state regulations.
- Depending on the situation, loan applications may be granted or forwarded to management.
Underwriting is the process of determining a borrower's eligibility for a loan. Loan officers examine a borrower's financial data to determine his or her need for a loan and ability to repay it. Soliciting a borrower's financial information is common in underwriting software. Loan officers make final decisions based on program output and an applicant's finances.
Loan officers deal with clients and conduct transactions. Loan officers, for example, are routinely asked to assist clients with loan applications. Many loan officers actively market their lending institution's products and services.
Loan officers are classified as follows:
Commercial loan officers assist firms finance purchases of commodities, upgrades, and expansions.
Commercial loans are typically larger and more complex than other loans. No bank is willing to offer the full amount demanded for large commercial loans. For a loan package, loan officers may need to contact many institutions.
Consumer loan officers help people buy cars and pay for schooling. Small consumer loans may be fully automated. Despite this, a loan officer is on standby to assist applicants. Especially smaller banks and credit unions don't employ underwriting software.
A mortgage loan officer specializes in loans for real estate purchases (property and buildings). Mortgage loan officers work with both business and residential loans. That means building relationships with real estate agents and other sources who can refer potential borrowers.
Some loan officers specialize in one of these three areas:
Non-paying borrowers are contacted directly by loan collection officials. Borrowers can stay up with their loan repayments due to their efforts. If the borrower continues to fail on the debt, they begin the process of removing and selling the collateral used to secure the loan.
Loan underwriters do considerable investigation and analysis to establish a potential customer's creditworthiness. Underwriters collect, verify, and analyze financial data from consumers to make loan recommendations.
Education
In most cases, loan officers require a bachelor's degree in a business or finance-related subject. It is important for commercial loan officers to know how to interpret financial accounts since they examine the finances of firms requesting for financing.
If you've worked in banking, customer service, or sales in the past, you might be able to get a career in this field without a four-year degree. Companies that specialize in a certain subject tend to favor candidates with some prior expertise in that industry. Candidates with experience in residential mortgages or real estate may be preferred by mortgage businesses.
Training
Loan officers are often given some on-the-job training once they are employed. In the initial few months of employment, there may be a mix of official training provided by the employer and informal training provided by coworkers.
Registration, Certification, and Licenses.
A Mortgage Loan Originator (MLO) license is required for all mortgage loan officers. In order to become licensed, they must pass a national test, complete pre-licensing training, and through a background and credit check process. Annual renewal of licenses is required, and some states impose extra conditions. More information can be found on your state licensing agency's website.
The American Bankers Association, the Mortgage Bankers Association, as well as a variety of educational institutions provide loan officers with education and training options. Although it is not needed, obtaining a certification can demonstrate a candidate's commitment and level of skill, which can help them land a job.
Qualities that are critical to success
Abilities to make decisions. Determine if an applicant's financial information is sufficient for the loan application to be approved.
Pays close attention to the smallest of details. Loan officers need to pay attention to the specifics of an application since they might impact the profitability of a loan.
Initiative. In order to promote their lending institution, loan officers may have to call people and companies to see whether they need a loan.
Relationship building abilities. Loan officers must be able to answer clients' inquiries and help them through the application process.
Pay
In May 2020, loan officers earned an average annual salary of $63,960. An occupation's median pay is the wage at which half of the workers make more than it and half make less. Between the bottom 10% and the top 10% of earners, there was a wide disparity.
Job Projections
From 2020 to 2030, it's expected that the number of people employed as loan officers will remain stable.
