Even if you’ve heard of a mortgage loan officer, you might not know their job description and salary. Perhaps this could be the right career choice for you!
A mortgage loan officer is a key player in a mortgage transaction, acting as an intermediary between their clients and the mortgage lenders.
Here’s what you need to know about the profession, how mortgage loan officers make money, and how you can excel in this job.
What Is a Mortgage Loan Officer?
A mortgage loan officer (MLO) helps borrowers secure financing to purchase real estate. These professionals are also known as mortgage brokers, and they work with borrowers and lenders to find the right loan products and negotiate the best rates for their clients.
Like lenders, mortgage loan officers conduct a pre-approval process that involves examining assets, credit checks, and income to determine how much money a potential client can borrow. Each loan has specific requirements, and mortgage loan officers help ensure that their clients provide the required documentation during the application process.
From there, mortgage loan officers work to find the best loan products for their clients based on their financial situations and requirements. A good loan officer can help borrowers gain low interest rates while complying with industry rules and federal regulations.
Since mortgage loan officers work with several different lenders, they can easily access more financing options than borrowers could access on their own. Loan officers also save borrowers from doing a lot of paperwork, compared to the effort it takes to shop around for loans independently and fill out multiple applications.
How Do Mortgage Loan Officers Make Money?
Mortgage loan officer salaries are mostly commission-based. As a result, the job and your expectation of compensation is what you make of it. If you work to close a large number of loans, you’ll earn more money in return.
Mortgage loan officers don’t need a college degree, and licensing costs are relatively low. This makes a mortgage loan officer a great career choice for hard-working people with an entrepreneurial spirit.
The first step toward getting a job as a mortgage loan officer involves obtaining the necessary education. While you don’t need a Bachelor’s Degree to get a job as a mortgage loan officer, a degree in business or finance won’t hurt. You will need a high school diploma or GED to become a mortgage loan officer.
Regardless of your formal education level, you’re required to complete 20 hours of coursework on the mortgage industry. The exact composition of the education courses varies by state, so make sure that you’re taking the right training programs in your location. Many different providers offer courses for certification, and they can accommodate many different schedules and timelines. Popular providers include the Mortgage Bankers Association and the American Bankers Association.
Step 2: Licensure
Next, you must obtain the necessary licensure by taking a national test developed by the Nationwide Mortgage Licensing System and Registry (NMLS).
This exam is used in all 50 states and consists of 125 questions. Of those 125 questions, only 115 are scored. The remaining ten are considered test questions for future versions of the exam.
You will have three hours to complete the NMLS, meaning you should be able to complete each question in 1.5 minutes or less. Instead of carefully considering each question, you should understand the material well enough to answer the questions quickly and accurately. This will demonstrate a comprehensive knowledge of the text material.
You need to answer 75% of the questions correctly to pass the exam. Don’t be discouraged if you don’t pass the first time around. Only 54% of test-takers pass the exam on their first attempt.
If you don’t pass the NMLS on your first try, you have to wait at least 30 days to retake it. If you fail three times, you will have to wait at least six months to retake the test.
Step 3: Securing a Position
Once you have completed your education and licensure requirements, the third and final step in becoming a mortgage loan officer involves securing a position with a firm.
After perfecting your resume and cover letter, start applying for open positions in your area. There’s a high demand for mortgage loan officers in California, Texas, Florida, North Carolina, and New York. Specific cities with a high demand for mortgage loan officers include Los Angeles, New York City, Chicago, Dallas, and Phoenix.
How to Excel as a Mortgage Loan Officer
Now that you’ve secured a position as a mortgage loan officer, it’s time to put in the work so you can excel in the position.
By finding your niche, listening to your clients, and marketing yourself effectively, you can set yourself up for success. Next, you can set goals, build relationships, and work with a team to prepare for the future. Finally, you’ll want to stay up-to-date on current industry trends to stay competitive in your field.
Tip 1: Find Your Niche
Find your lending niche and refine your skills to corner a market area that could benefit from your expertise. For instance, you could focus on providing commercial loans for foreign investors.
Tip 2: Listen to Your Clients
Always listen to your clients so your recommendations can meet their needs. Listening leads to good reviews, which leads to new clients.
Tip 3: Market Yourself
As a mortgage loan officer, you are your business — so you need to market yourself! You can create a Facebook page, Instagram profile, or even a TikTok account to post relevant content and get your name out there.
Tip 4: Set Goals
You should set short-term and long-term goals, then work hard to achieve them. Make sure that your goals strike a balance between realism and idealism.
Tip 5: Build Relationships
Constantly build high quality relationships with people in your community. Everyone you talk to should be seen as a potential client. At the same time, you shouldn’t be pushy about your services. Instead, develop an elevator pitch that leaves plenty of room for questions and captures people’s attention.
Tip 6: Work With a Team
Many mortgage loan officers work for a larger organization. If you’re new to the position, this is a trait that you can use to your advantage. Learn from your colleagues and play off of their strengths.
Tip 7: Stay Up-to-Date
You need to stay up-to-date on industry trends, as the occupation is constantly changing. To maintain your license, you’re required to complete continuing education classes and job training. To maximize your success, go beyond that bare minimum by attending events, taking additional classes, or subscribing to relevant publications.
Mortgage loan officers help their clients secure the best possible loans and terms by matching them with the right mortgage loan originator and finding the best mortgage for their needs.
If you’re looking for an experienced mortgage loan officer with honesty and integrity that can help you achieve your goals, reach out to the mortgage brokers at Vaster for expert advice tailored to your financial situation. We'll help you find the right fit and guide you through your loan process every step of the way.