By Neena Vlamis, President of A and N Mortgage

Navigating the challenges of obtaining a mortgage for a dream home can be a daunting experience. A licensed loan officer helps to alleviate those challenges by guiding their clients through the financial process while also educating them about the best possible options. 

If you want to learn more about what it takes to become a successful and reputable loan officer then continue reading below for tips and answers to common questions.

What is a Loan Officer?

How to Become A Loan Officer

A loan officer is an individual who works at a financial institution—like a bank, credit union, or lending company—who is responsible for helping clients apply for loans. Loan officers gather information like tax returns, pay stubs, and credit reports to determine how likely people or corporations are to repay a loan. 

What Does a Loan Officer Do?

The loan officer job profile encompasses all parts of the loan application process. These duties include collecting the information required to complete and process an application to make sure that each application is accurate. From there, loan officers are required to analyze the information they’ve received. They will determine if a particular client is creditworthy and under which conditions a loan should be granted to a client. Additionally, it is the loan officer’s responsibility to appraise the client of the application’s status and build trust throughout the process.

Loan officers will typically acquire a specialization, but they’re found in tons of different areas. As mentioned, mortgages are a booming business, but loan officers can also be responsible for car loans, consumer loans, mortgages, and student loans, among other things. Loan officers will advise their clients of the best available loan options and inform them of various requirements to help them navigate the process. 

To keep clients happy, mortgage officers, in particular, must do what it takes to earn and maintain their clients’ trust. It’s not uncommon for mortgage lenders to service the same client through more than one loan process through the years. Clients are happy to refer their friends and family members to their loan officer if they feel that they have been well taken care of by him or her.

What Documentation is Required to Become a Loan Officer?

While it is possible to become a loan officer without a bachelor’s degree, many loan officers do have four-year degrees. If you’re considering a career as a loan officer, studying business-adjacent fields, like finance or accounting, will help prepare you for this type of work.

If a college degree isn’t in the game plan, begin building experience in the industry. Some community colleges offer undergraduate certificate programs specifically for mortgage loan originators. There are also diplomas and certificate programs available from the American Bankers Association American Institute of Banking to prepare you for your work as a loan officer. These certificates cover topics like building customer referrals, ethics, general accounting, personal tax return analysis, the law, and banking. Completing one of these programs will ensure that you know how to properly analyze financial statements, evaluate and structure corporate loans, grow business relationships, and more. 

While the above degrees and certificates will prepare you for what to expect as a loan officer, banks will hire loan officers who have as much as five years of experience or more in a related field, even without a degree. Work in customer service or sales is also beneficial if you choose to take a non-traditional approach to become a loan officer. 

Licensing

If you decide to become a loan officer, you will also have to obtain a proper license from the NMLS and meet the licensing requirements of the state that you plan to practice in. After undergoing a background check and completing the required education, you will be licensed to grant mortgages in a particular state. It can take a few weeks or months to meet the pre-licensing education requirements and pass the appropriate examinations to obtain loan officer certification.

Each year, you will be required to undergo several hours of continuing education in order to keep your license active. Use the opportunities for continuing education to acquire additional professional certifications. For example, the American Bankers Association offers certificates in Commercial Lending and Residential Mortgage Lending that allows you to sharpen your skills and keep up with the latest rules and regulations.  

What are the Steps to Become a Mortgage Loan Officer?

You’ll need to follow these steps to become a mortgage loan officer:

  1. Register with the NMLS (Nationwide Multistate Licensing System & Registry) here. You’ll receive an NMLS ID when you do. This will enable you to apply for a new license or register for many states in the US.
  2. Use your NMLS ID to create an account. Follow the prompts as directed. If your state regulator or your mortgage company requires it, be prepared to complete and file your Individual (MU4) form with the NMLS before you can proceed. If you are working with a mortgage company like A and N Mortgage, contact them at this point so that they can take the next steps and set up your sponsorship if applicable. Until your sponsorship has been set up by a mortgage company, any individual who completes the NMLS registration process will receive a license that is issued as “approved-inactive,” meaning that all requirements except employment have been met.
  3. After you’ve created your NMLS account and filed your MU4 form, you’ll need to undertake the following components in order to receive your license:
  • Complete 20 hours of approved education. This can be done online or in person. This is a good place to get your required education hours online.
  • Pass a criminal background check and have your fingerprints taken.
  • Submit a credit check.
  • Apply for the appropriate state license.
  • Pay all relevant fees associated with the licensing process. 
  • Schedule and pass the in-person knowledge test of rules and regulations.
  1. Become an expert on mortgage guidelines. A and N Mortgage will help to coach you through this by putting you on a team that will help set you up for success. 
  1. A and N will help fast track your success by giving you practical on-the-job training and business development support.

How to Become a Successful Loan Officer

 To become a successful mortgage officer, it would be wise to form working relationships with real estate developers, builders, and real estate agents who can refer clients to you as you build your client base. Having excellent communication and interpersonal skills can help you become an effective loan officer. You may need to encourage loan applications when interest rates are higher, and applications taper off slightly and may find yourself regularly talking to clients.

As loan officers gain more experience, they are often promoted to positions with greater responsibility. This promotion can be to a management position that requires them to oversee a group of loan officers, or they may be responsible for closing sales and working closely with more prominent clients. These promotions lead to higher commissions from sales.

Eventually, some mortgage loan officers may become independent mortgage brokers. As mortgage brokers, they match the client with the best lender for their needs and earn a commission for making the match. 

Contact A and N Mortgage for Professional Advice

Mortgage loan officers are in exceptionally high demand right now as interest rates are low and the real estate market is red-hot. It takes a particular skill set to navigate people through the process of securing a loan like a mortgage. It can be an arduous and tedious undertaking without a knowledgeable loan officer at the helm.

Whether you go the traditional route of pursuing a four-year degree or obtaining certificates that prepare you for a loan officer’s role or choose to take a non-traditional path by gaining years of experience in a related field, you can eventually find yourself in the position of a loan officer. With the relevant state and local licenses, you will have the power to review loan applications and walk clients through the process of applying for a mortgage.

If you’re willing to earn a client’s trust and work to patiently guide them through the intricacies of the mortgage process, being a successful mortgage loan officer can be a rewarding career. After all of the potentially late nights, mountains of paperwork, and financial analyses that you undertake to determine creditworthiness, you do have a direct impact on a person’s ability to acquire the home of their dreams.

Earning your client’s respect ensures that you complete the loan process with as little discomfort as possible. Since being a mortgage officer is as much about the relationship that you build with your clients, work to understand them, and build trust throughout your interactions. It is through these relationships that you receive referrals and advances your career.

For more information on becoming a licensed mortgage loan officer in Chicago, contact A and N Mortgage. We’re always looking to add dedicated loan officers to our competitive roster of some of the most qualified, hardest-working mortgage loan officers in the Chicago metropolitan area. 

 

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