What is a Loan Officer?

The most widely accepted loan officer definition is that they are professionals who evaluate loan applications for businesses and individuals. Banks and other financial institutions rely on loan officers to screen applicants, helping clients get a loan that fits their needs and their financial possibilities while explaining to applicants the terms of each loan. Applications done by the client with the help of a loan officer, often called mortgage officers, go to an underwriter who reviews it to determine whether the client is eligible for the loan.

How do you become a Loan Officer?

To get hired as a loan officer, requirements typically include a bachelor's degree in finance, economics, or a related field of work. In some cases, if the individual has training and work experience, some employers will only require a high school diploma. Most loan officers will need a Mortgage Loan Originator (MLO) license and be certified by the Nationwide Multistate Licensing System (NMLS) National and State testing.

Loan officer courses and NMLS approved education for pre-licensing are required for acquiring a license and starting the path to become a loan officer.

Mortgage Loan Officer Skill Set

  • Knowledge of financial software
  • Customer service
  • Thoroughness
  • Communicating with clients
  • Analyzing information
  • Decision making

Loan Officer Salary

Job Average Base Salary Years of Experience Minimum Credential Preferred
Loan Officer $71,198 10 Bachelor’s Degree
Loan Officer Assistant $43,509 0-2 Bachelor’s Degree

What Does a Mortgage Loan Officer Do?

Some of the duties of a loan officer include:

  • Being the first point of contact with prospective loan clients
  • Meeting possible applicants to determine the most suitable loan product
  • Reviewing financial data in order to determine risk factors
  • Submitting reviewed applications to management in order to approve or reject the loan
  • Promoting the institution’s services and assisting clients in determining the most suitable loan to meet their financial objectives and needs
  • Submitting the processed applications to the manager with the observations found in order to approve or reject the loan
  • Following up with applicants and clients in order to keep all information up to date by completing credit and loan documentation and contacting them to obtain additional information regarding loan applications
  • Providing good-quality customer service according to company policies
  • Scheduling and tracking of closing dates, contingency dates, and loan lock expirations
  • Approve loans by issuing checks or forwarding applications to loan committee
  • Complete loan contracts by explaining risks to applicants, reviewing filled applications, obtaining signatures and notarizations, and collecting fees

Job Outlook

According to the Bureau of Labor Statistics (BLS) in April 2020; Employment of loan officers is projected to grow 3 percent from 2019 to 2029, about as fast as the average for all occupations. Although the demand for loan officers will increase as the overall economy grows, the decline of bank branches may moderate employment growth.

Similar positions

  • Commercial lenders
  • Loan authorizers
  • Loan collection officers
  • Loan underwriters

Career Advancement

Depending on the path, loan officers can become:

  • Loan authorizers
  • Senior mortgage officers
  • Mortgage underwriters

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