Loan officer.....anyone do it for a living? Do you like it?

[Mother Mucker]

I mentioned before how I'm getting sick of accounting and thinking about a change. I had an interview for a loan officer position yesterday and it was interesting.

Anyone do it for living? What are the pros and cons of the job?

TIA

[ScottieK]

I'm not a loan officer, but I am a loan analyst and work closely with loan officers for commercial clients. Pros - big accounts bring big commissions, get to schmooze on golf courses and in restaurants, essentially make your own hours since most of your salary is commissions-based....sky's the limit. Will also get to learn how businessmen structure their entities and operations, very good business training. Cons - small accounts bring small commissions, extremely competitive market conditions nowadays, flat yield curve affects rate spread and profitability. Most money is made on non-interest bearing deposits that your clients bring to your bank, and with rising interest rates, those are becoming harder to get....and if you're starting new, you'll have to generate your own leads or get them from your fellow loan officers. A lot of time spent on the phone and in meetings with clients...if that's no problem, then go for it.

Any other questions, I'll try to help as much as I can.

ScottieK

[liquidboss]

I did it for a living for about a year. It has its pros and cons.

<u>Pros</u>
- Sky is the limit as far as income potential.
- At most places you get to run your daily activities without too much micro-management (as long as you are selling.)

<u>Cons</u>
- It's a sales job. I don't know how much experience you have with sales, but get ready to always be worried about numbers, quotas, and how you stack up against other LOs.
- Leads... Finding people to actually do transactions for it literally 50% of the work. Most people tap friends and family to start, many brokers provide leads (you usually make less of a split if they do,) and there are tons of places you can buy leads from.
- Slowing real estate market. If you could have got into the business a few years back you would probably already be rich. When rates hit their super lows you could literally cold call people on the phone to ask if they wanted to refi and they would say yes.
- Be prepared to be faced with moral decisions regarding how willing you are to screw people. Loan officers make money by taking as much as you can from the borrower, there is no other way to put it. You either make money by charging them points on the front and adding to their loan balance, or get paid points by the lender on the back by giving the borrower a higher rate than they qualify for. Usually a combination of the two. You have to be willing to charge a lot for the service you provide.

The other thing I could say is that your experience is going to vary a lot depending on what kind of mortgages you are going to do. There is a big difference between working for a sub-prime shop selling refis and debt consolidation and doing conforming loans for people walking into Wells Fargo with their excellent credit wanting to buy their dream house.

[Mother Mucker]

Thanks for the replies.

The position I interviewed for would be for mostly new purchases and not refi's. The leads would be provided to me from a reputable source, that I'd rather not say right now, and yes, my split is a little less because the leads are given to me. They said that I'd make between 50 and 70 phone calls a day and that I'd be expected to close at least 2 loans a month by my 4th month. If I'm not, they said then this probably isn't the business for me.

About the whole "screwing" aspect, I don't look at it that way. The people that I would be calling went ahead and filled out applications for loans. It's not like I'm calling Joe Schmoe out of the blue. They showed some sort of interest in getting a loan. I'd talk to them a little bit, get their information, and present a quote. If they don't like it, it's totally on them to say no.

[microbet]

I did it as a regular employee for a little over a year and sorta still do it as an independent broker.

I didn't/don't like it at all, but I hate sales. I hate talking to people on the phone forever about things I don't care about, especially when I'm saying the same thing over and over and over and over. I was doing commercial/multifamily properties. It's worse in single family.

I sucked at it, but was lucky to be in a position where I could suck and still make some money. If I were good I would have made a ton. In most LO jobs, you won't make any money if you aren't good, but if you are really good you can make a lot.

I think for the most part it's a personality issue whether someone will be successful in sales and the people who are tremendously successful are really quite unique people.

[liquidboss]

[ QUOTE ]
Thanks for the replies.

The position I interviewed for would be for mostly new purchases and not refi's. The leads would be provided to me from a reputable source, that I'd rather not say right now, and yes, my split is a little less because the leads are given to me. They said that I'd make between 50 and 70 phone calls a day and that I'd be expected to close at least 2 loans a month by my 4th month. If I'm not, they said then this probably isn't the business for me.

About the whole "screwing" aspect, I don't look at it that way. The people that I would be calling went ahead and filled out applications for loans. It's not like I'm calling Joe Schmoe out of the blue. They showed some sort of interest in getting a loan. I'd talk to them a little bit, get their information, and present a quote. If they don't like it, it's totally on them to say no.

[/ QUOTE ]

Just know that you make your commission by either adding a thousands to their loan amount or by giving them a higher interest rate than they qualify for without telling them. Its your job to try to convince or trick them into letting you charge the most you can. You can go about that however you want, but the people who make a lot of money in this industry do many other under-handed things to bump their commissions. That isn't to say you can't make money and not screw people, but you will see, it is a very immoral industry. It probably won't be as bad if you are doing mostly new purchase, but you should be prepared to work with people doing this and be ready for plenty of pressure from them to do it yourself.

[mbillie1]

[ QUOTE ]
Thanks for the replies.

The position I interviewed for would be for mostly new purchases and not refi's. The leads would be provided to me from a reputable source, that I'd rather not say right now, and yes, my split is a little less because the leads are given to me. They said that I'd make between 50 and 70 phone calls a day and that I'd be expected to close at least 2 loans a month by my 4th month. If I'm not, they said then this probably isn't the business for me.


[/ QUOTE ]

This seems like a very reasonable quota... to the other former LO's who posted, what were your average monthly # of loans closed?

[liquidboss]

[ QUOTE ]
[ QUOTE ]
Thanks for the replies.

The position I interviewed for would be for mostly new purchases and not refi's. The leads would be provided to me from a reputable source, that I'd rather not say right now, and yes, my split is a little less because the leads are given to me. They said that I'd make between 50 and 70 phone calls a day and that I'd be expected to close at least 2 loans a month by my 4th month. If I'm not, they said then this probably isn't the business for me.


[/ QUOTE ]

This seems like a very reasonable quota... to the other former LO's who posted, what were your average monthly # of loans closed?

[/ QUOTE ]

It was usually 2-5 loans a month. Quotas aren't based on the number of loans, they are based on the closing costs you are charging. Mine was $18k a month for most of the time I was there.

[Mother Mucker]

[ QUOTE ]
[ QUOTE ]
Thanks for the replies.

The position I interviewed for would be for mostly new purchases and not refi's. The leads would be provided to me from a reputable source, that I'd rather not say right now, and yes, my split is a little less because the leads are given to me. They said that I'd make between 50 and 70 phone calls a day and that I'd be expected to close at least 2 loans a month by my 4th month. If I'm not, they said then this probably isn't the business for me.

About the whole "screwing" aspect, I don't look at it that way. The people that I would be calling went ahead and filled out applications for loans. It's not like I'm calling Joe Schmoe out of the blue. They showed some sort of interest in getting a loan. I'd talk to them a little bit, get their information, and present a quote. If they don't like it, it's totally on them to say no.

[/ QUOTE ]

Just know that you make your commission by either adding a thousands to their loan amount or by giving them a higher interest rate than they qualify for without telling them. Its your job to try to convince or trick them into letting you charge the most you can. You can go about that however you want, but the people who make a lot of money in this industry do many other under-handed things to bump their commissions. That isn't to say you can't make money and not screw people, but you will see, it is a very immoral industry. It probably won't be as bad if you are doing mostly new purchase, but you should be prepared to work with people doing this and be ready for plenty of pressure from them to do it yourself.

[/ QUOTE ]

True, but is charging more (either in interest or on the total amount of th loan) really that immoral? I look at it as just business and someone making a profit. I'm sure McDonald's could charge you less for a Big Mac but they want to make money. I wouldn't say charging me :insertpriceofBigMachere: for a Big Mac is immoral.

[scotchnrocks]

If you walk into a McDonald's without knowing the cost of a Big Mac, and they charge you $2.49 for the Big Mac (because they read you as a sucker) and should only be charging you the normal price of $1.99 that still makes them a profit...that is immoral.