A loan officer is a professional who assists borrowers in obtaining loans. Loan officers are essential to the success of any business. They are responsible for helping borrowers get the money they need to start and grow their businesses.
A loan officer can help you find the best loan, get the loan you need, and stay afloat in tough times. In this blog post, we’re going to take a look at what a loan officer does and how you can best use them in your business.
What does a loan officer do?
A loan officer is responsible for providing personalized and effective financial counseling to individuals and families. He or she also works with the mortgage lender to help borrowers get the best interest rate possible on their loan. Loan officers are also responsible for providing information about credit products and services, making loans available at the best time for borrowers, and working with the borrower’s assigned lender to get the best terms.
Loan officers help people and businesses secure financing. Loan officers often help people get money for homes, cars, college tuition and even start-up businesses. They determine the amount of money the individual should receive and communicate any requirements and stipulations that accompany the loan. Some loan officers specialize in mortgages or commercial loans. Some of their specific responsibilities include:
Meeting with customers to determine their needs and recommending loan products to meet their needs
Maintaining an active knowledge of the organization’s loan products and the qualifications required
Reviewing active loans to determine if any documents are missing and whether anything can be done to speed up the process for each customer
Utilizing professional opinion to determine whether a potential borrower is a good risk for the organization
Salaries vary according to the geographic location and experience levels of the loan officer. For the most up-to-date salary information from Indeed, click on the salary link.
Common salary in the U.S.: $161,477 per year
Some salaries range from $14,000 to $234,000 per year.
Loan officer requirements
There are several qualifications required to obtain a position as a loan officer. They include:
Though some employers may accept candidates who have a high school diploma or GED along with the completion of a certificate program in mortgage finance, most employers prefer that candidates hold a minimum of a bachelor’s degree in finance, economics, business or another closely related field. That said, high school students who excel in mathematics are ideal candidates for loan offer training programs.
Aspiring loan offers who obtain a bachelor’s degree in finance will get the skills to negotiate and present deals for the benefit of a consumer or a business. This degree — or any other formal education experience — also will ensure candidates are proficient with computers and that they have the business writing skills essential in this industry.
To qualify for a position as a loan officer, candidates typically have a combination of on-the-job and formal, company-sponsored training. Many companies provide training programs for new hires and then also provide informal on-the-job training for the first few months after being hired.
Depending on the work you intend to do, certification or licensing may be required. Some of the most common certifications and licenses include:
Mortgage Loan Originator (MLO)
All mortgage loan offers are required to be licensed as a mortgage loan originator (MLO). The exam has a national and state component that is unique depending on your state. Candidates must have at least 20 hours of pre-licensure education. They must pass the exam and a background and credit check.
Certified Mortgage Banker (CMB) Certification
Candidates have two options with the CMB certification: Residential CMB or Executive CMB. To be eligible for the Residential CMB, candidates must have five or more years in real estate finance. Once they qualify, they must pass a six-hour written exam and a one-hour oral exam. To be eligible for the Executive CMB, candidates must have ten or more years in real estate finance. They must also have completed the Mortgage Bankers Association (MBA) CMB prep course. Once they qualify, to obtain the certification, candidates must pass a six-hour written exam and one-hour oral exam.
There are several skills necessary to succeed in the position of a loan officer. They include:
Attention to detail
Candidates must have strong attention to detail, as each piece of information included in a customer’s application can impact the profitability of a loan.
Decision-making skills refer to the ability to choose between two or more courses of action. Loan officers must assess an applicant’s financial information and then decide whether that person is a good candidate for a loan.
Commonly referred to as “people skills,” these refer to the ability to communicate effectively, to listen actively and to work as part of a team. Loan officers must be able to work with people well to guide them through the application process and ensure everything is filled out completely and accurately. Loan officers must also be able to answer questions and provide reassurance throughout the process.
These refer to the math and finance skills that candidates must have to successfully process loans.
Selling is one of the main focuses of this role. If the loan officer works for a large company, they may take calls most of their day and sell potential customers on loan products. They may also work to generate leads of their own. In either case, the loan officer must spend much of the day selling, and therefore must have the ability to assess and start sales or generate leads independently.
Loan officer work environment
Loan officers often work outside the office and meet customers at their homes or businesses. They also work in offices with the following characteristics:
Extended hours sitting at a desk
Using computers, printers, fax machines and other office equipment
Facilitating communication between customers and management
May require travel
Loan officers work in commercial banks and savings institutions and for mortgage companies. Loan officers typically work full time and many work long hours.
How to become a loan officer
These are the steps typically required to pursue a career as a loan officer:
1. Pursue an education.
While some employers will accept candidates who have a high school diploma or GED along with the completion of a certification program, most employers prefer loan officer candidates hold a bachelor’s degree in finance or another similar field. Perform a search for open loan officer positions in your geographic area and determine the level of education required for your immediate area. Obtain that level of education.
2. Obtain a license.
If you intend to purpose a position as a mortgage loan officer, you will need a license. Though not required, you may also want to consider a CMB certification to show your dedication and make yourself more competitive in the job market.
3. Update your resume.
When you have the required education or certifications and a license — if you intend to be a mortgage loan officer — update your resume. Include your highest level of education, your relevant work history and your transferrable skills. For each position, highlight the skills you used in previous roles that further qualify you for a loan officer position.
4. Apply for jobs.
Perform a search of open loan officer positions in your geographic area and identify the roles for which you are most qualified based on your education and experience. If you need more experience, look for loan officer assistant roles before seeking a loan officer position. Apply for the positions using your newly updated resume and a cover letter that you have customized for each role.
Loan officer job description example
Easy Street Mortgage Co. is seeking a loan officer to join its team. The loan officer will be responsible for verifying, compiling and inputting application information for our clients’ mortgage loans. They will be expected to be knowledgeable about all of our loan products and advise customers regarding a loan that will best meet their needs. Candidates are expected to have applicable state licensing. The ideal candidate will have a minimum of two years of experience and strong interpersonal skills and attention to detail.