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Updated over 4 years ago on . Most recent reply
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Becoming a Loan Officer advice
I'm considering a move into the mortgage industry to better align myself with my real estate investing goals. What advice can you give about the industry and what I should be looking for in a company?
I would be transitioning from a sales position 100% commission, no base, health benefits included and a fairly flexible schedule. What should I expect as a new Loan Officer?
Thanks,
Greg
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@Greg Betts With the new laws that have been in place a few years now, loan officers are compensated differently than in the past. You will still be 100% commission however unlike in the past, now you will be paid at least a minimum draw amount of minimum wage an hour against your commissions. Because of this change in the law, lenders now have minimum production requirements for their loan officers.
Typically you must close between 2-4 loans a month or they will let you go. Below that amount, your costing them more than what your making them.
You will typically get between 1-1.5% of the loan amount as your commissions per loan. Most lenders are large enough that they will offer you full benefits or close to full benefits.
You need to concentrate on the loans that are clean, easy and fast closings. Try not to get to many that are to complicated and drawn out, they will demand to much of your time when your 1st starting out. Realtors will be a primary source of your loan referrals, so develop those relationships as much as possible.
Refinances are quick and can be easy, but they get complicated and down right frustrating when a property doesn't appraise for what you need to make a deal work. So, yes go after them, but be very strategic in what and how much you go after them.
It will take you between 30-60 days to close on your 1st deals in the pipeline, so account for the time you will need to market for and get the 1st batch of loans. You might prime the pump and be talking to some of your contacts now to let them know your going that direction so you have as many loans as possible right when you start.
Get with more senior loan officers and loan officer assistants and processors, make them your top go to people. Gain as much knowledge about the systems and guidelines as you can. Learn fast, move your files forward and be aggressive in doing so every day.
Spend a min. of 2 hours a day up to 6 hours a day marketing. The number one task you have is keeping a pipeline with enough funding's to close a min. of 4 a month for 3 months. You typically close between 25-50% of the loans that you get applications for. So if you want to close 4 a month, you must get 16 new applications a month to start.
That should give you an idea of the starting life of a loan officer.