Loan Officers examine if a potential borrower qualifies for a loan. They are normally hired within financial institutions, such as banks, credit unions, and trust companies.
Due to their intermediary labor in acquiring a loan, many Loan Officers work in exchange of origination points, which is the commission resulted from the process borrowers face when they are conferred a loan or a mortgage.
This position, also called Mortgage Officer, is easily confused with the one of Mortgage Broker. The latter is an independent party, who has the possibility of seeking loans from different institutions. In this regard, Loan Officers are appointed to a single financial organization, providing direct contact with the company, while Mortgage Officers stand as an intermediary between the borrower and the lender.
Here’s a non-exhaustive list of common tasks Loan Officers are required to complete.
- Supporting new and current clients on loan and credit products:
- Setting up meetings with clients to obtain information on the loan needs;
- interviewing applicants for personal, mortgage, student, and business loans;
- providing assistance in determining the most suitable loan option; and
- providing guidance on the lending process.
- Assisting the Manager, before the loan’s approval or rejection, by ensuring the client meets the requirements to obtain a loan:
- Collecting information and processing each file to the closing stage;
- contacting other financial institutions to verify the financial background of loan applicants;
- examining applicants’ assets and finances;
- analyzing the applicants’ capability to repay loans by conducting a thorough assessment on loan worthiness; and
- submitting a detailed report regarding any abnormality on the processed file.
- Ensuring the repayment of approved loans and credits:
- Verifying loan and credit documentation;
- ordering appraisals to be conducted on applicants’ properties and reviewing the title insurances;
- calculating payment schedules; and
- monitoring clients in order to guarantee their timely payment.
- Maintaining detailed records on the transactions executed daily:
- Compiling, copying, sorting, and filing records of the applications in progress and the ones already approved;
- keeping a thorough daily record of every loan request; and
- updating, filing, mailing, and maintaining inventory and database systems.
- Processing, reviewing, and completing loan and credit requests:
- Verifying the documentation contained in each application; and
- submitting the application to the manager for the credit or loan’s approval or rejection.
- Contributing to ongoing professional business development activities:
- Cooperating with the company’s endeavor of achieving gross revenue and net operating income objectives;
- working in conjunction with colleagues to gather marketing information, statistics, and trends; and
- developing relationships within the community to attract new mortgage loan applications.
- Drafting communications (e.g. letters and emails) to customers regarding payment reminders, warnings for action against payment default, or account status updates.
- Ensuring compliance with all internal control and established policies related to loan products, in order to guarantee transparency in every application processed.
- Contacting and setting up meetings with prospective and current loan clients.
- Interviewing applicants for personal, mortgage, student, and business loans.
- Researching and evaluating loan applicant’s financial status, references, credit, and ability to repay.
- Communicating with other financial institutions to request details on clients’ creditworthiness.
- 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.
- Keeping the loan files supporting and clients’ information up-to-date by completing credit and loan documentation, preparing detailed reports, and maintaining detailed computerized records.
- Ensuring necessary due diligence to support clients and maintaining high ethical standards.
- Researching, gathering, and analyzing data to make effective and profitable decisions.
- Staying up-to-date on credit and loans current regulations.
The average Loan Officer salary is $41,072 per year or $21 per hour. This is around 1.3 times more than the Median wage of the country. Entry level positions start at $29,000 while most experienced workers make up to $58,000. These results are based on 6 salaries extracted from job descriptions.