Mortgage and Loan Education

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Loan Officer Training

Written by Dana Hinders
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Loan officers use their knowledge of the lending process to provide clients with the type of loan that best meets their needs. Loan officers analyze credit scores, prepare loan applications, and compute loan payments. They refinance existing loans and provide sub-prime loans to borrowers with poor credit histories.

Loan officers are generally paid on a commission basis. They typically receive around one percent of a loan's total amount. A loan officer's income is directly tied to his or her effort and ability to approve a client's loan application. Most loan officers make about $50,000 per year, but their income potential is unlimited.

Successful loan officers are persuasive and have strong negotiating skills. They are good with numbers and pay attention to details. If this describes you, a loan officer training program can give you the knowledge you need to turn your natural talents into a rewarding career.

Types of Training

Many loan officers have undergraduate degrees in business, economics, or accounting. However, a degree is not necessary to become a loan officer. Training seminars, correspondence courses, and certification programs can provide job seekers with the skills they need enter this profession.

Most loan officer training programs cover how to process a loan application, comply with federal mortgage regulations, and compare the various types of loan products. Some loan officer training programs will provide sales and marketing advice for loan officers who wish to open their own businesses. Most instructors in loan officer training programs have several years of industry experience and are ideally experts in their field.

No two loan officer training programs are alike. Some training programs offer classroom instruction during the weekend and evening hours, while others specialize in print or web-based distance learning. Some loan officer training programs provide mentors, job placement services, and financial aid for their students. Trade publications, your state's regulatory agency, and local professional associations can help you select the loan officer training program that is most appropriate for your needs.

Licensing Requirements

There are no specific licensing requirements for loan officers who work in banks or credit unions, but licensing requirements for loan officers who work in mortgage banks or brokerages are determined on a state by state basis. Some states require that loan officers pass a written examination and submit to criminal background and credit check before obtaining a license. Other states do not require a loan officer to be licensed if his or her employer is fully licensed. Loan officer licenses are generally not transferable; a loan officer must be licensed in every state in which he or she wishes to conduct business.

It is your responsibility to determine if a loan officer training program will meet your state's licensing requirements. If you wish to open your own business, you may also need to have a mortgage broker's license. Mortgage brokers are typically required to maintain a surety bond of up to $100,000 and a specific net worth of up to $50,000. They may also be required to have a certain amount of previous lending experience.


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