WHAT DOES MY MORTGAGE GUY DO ALL DAY?
A career in the mortgage business
If ever you have ever thought of becoming a Mortgage Consultant, or just wondered what yours does all day, then sit down and take a look.
First off, I am a former Mortgage Consultant, and have worked in one of the worst ‘houses on the block’, to one of the best, so I am writing this from the perspective of an insider in the business.
People often assume I was a broker when I told them where I worked, or told them I was a loan officer. The two are similar, yet quite different. A loan officer does not need to have a real estate license as he is covered by someone or organization, like Bank of America, for example. A loan officer originates loans only for the company he works for and does not shop your deal around to different lenders.
Unlike the stockbroker which we covered in the previous two articles a loan officer keeps a little closer to banker’s hours. A loan officer is akin to a Jack of all trades and will know about every step in the process, and be familiar with each person’s jobs whose involved in funding your loan.
The first task for any LO (Loan Officer) is to originate loans, and that can be from the dreaded cold calling to networking with real estate professionals to snail mail campaigns. And once in awhile the phone rings and there is a loan on the other end of the line.
The toughest part of the deal is trying to figure out what loan program is the best fit for your situation. When you are dealing with prime borrowers this is usually fairly simple. When you are dealing with subprime borrowers it’s not so easy. You have to be very determined, creative, and knowledgeable to find a program that will fit with your borrowers needs, despite his credit challenges, for example.
If a deal is packaged badly and presented poorly to the underwriters it may get turned down. Then someone else could take that exact deal, pre package and present it and if passes with flying colors. Bottom line, the loan officer, or mortgage consultant, has to be intimately familiar with his/hers company guidelines, otherwise a fairly high percentage of their loans will get turned down when they could have easily gone through and funded.
Speaking of company guidelines, probably the area that trips up new LO’s is calculating the rate from the often complicated rate sheets. Nothing will kill a deal faster than a situation where the loan needs to be re-priced and the borrower will have to accept a new higher rate. You would be surprised though at how many borrowers stick around if you are upfront and honest about your mistake. They know not everyone is perfect one hundred percent of the time.
Once the loan is ‘in the pipe’ every aspect of the process has to be tracked by the LO to make sure the process doesn’t held up for any reason. Things that can trip up your deal can be issues with documents (maybe something was unreadable), to problems with the appraisal or the appraiser himself.
As a loan officer you have to pick the deals you are going to do carefully. One can only balance so many loans at a time so if you choose the wrong deals and they fail to fund; you have just worked for free that month. Since the job is a sales job, your pay is 100% commission and there is no other way to generate income outside of closing your loans.
Both careers, that of a stockbroker and a loan officer can be challenging and very rewarding, not to mention lucrative. While it is infinitely more difficult to make it as a stockbroker or financial advisor, the payoff is a much higher paycheck, and the freedom to be your own boss, set your own hours, take off when you like, and make as much money as you are willing to work for.
Advantages of being a loan officer, or mortgage consultant, is you have only a couple different products to keep track of, and they do not change from day to day like stocks or many of the different type of investments stockbrokers have to stay on top of. This is a much more relaxed environment than that of a brokerage office where the tensions run high.
Bottom line, only you know what you are suited for and hopefully I have given enough information for you to make an educated decision about the two options.
Good Luck and happy choosing.
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