Loan Officer Career
A Loan Officer facilitates lending by finding potential clients and helping them to apply for loans. Loan officers also gather personal information about clients and businesses to ensure an informed decision regarding their creditworthiness and the probability of repayment. Loan officers may also provide guidance to prospective borrowers who have problems qualifying for traditional loans.
Common Work Tasks
- Determine the most appropriate type of loan for a particular customer and explain specific requirements and restrictions associated with the loan
- Guide clients through the process of applying for a loan
- Conduct meetings or telephone calls with prospective clients, obtaining basic information about the purpose of the loan and explaining the different types of loans and credit terms available to the applicant
- Answer questions about the process and sometimes assist clients in filling out the application
- Access and record a client’s credit history and credit score
- Contact firms to determine their needs for loans
- Develop relationships with commercial and residential real estate agencies so that, when an individual or firm buys a property, the real estate will recommend them for financing
- Evaluate a client’s creditworthiness and conduct a financial analysis or other risk assessment
- Travel to other cities to prepare complex loan agreements
- Analyze whether a prospective loan meets the lending institution’s requirements
Other Job Titles
Loan Officers are also known by other titles, including:
- Loan Underwriter
- Loan Collection Officer
- Commercial Loan Officer
- Consumer Loan Officer
- Mortgage Loan Officer
- Risk Assessment Analyst
Education, Training, and Experience
Education and Training
Loan officer positions generally require a bachelor’s degree in finance, economics, or a related field. Loan officers without a college degree often advance to their positions after gaining several years of work experience in various other related occupations, such as teller or customer service representative.
Certification and Licensure
There are currently no specific licensing requirements for loan officers working in banks or credit unions. Training and licensing requirements for loan officers who work in mortgage banks or brokerages vary by State and may include continuing education requirements. As the types of mortgages offered to prospective homebuyers increases, licensing requirements may become more stringent as regulators and lawmakers become more leery of possible predatory lending.
The Bank Administration Institute, an affiliate of the American Bankers Association, offers the Loan Review Certificate Program for people who review and approve loans. This program enhances the quality of reviews and improves the early detection of deteriorating loans, thereby contributing to the safety and soundness of the loan portfolio.
The Mortgage Bankers Association offers the Certified Mortgage Banker (CMB) designation to loan officers in real estate finance. The association offers three CMB designations: residential, commerce, and masters to candidates who have 3 years of experience, earn educational credits, and pass an exam. Completion of these courses and programs generally enhances employment and advancement opportunities.
People planning a career as a loan officer should be good at working with others, confident in their abilities, and highly motivated. Loan officers must be willing to attend community events as representatives of their employer. Sales ability, good interpersonal and communication skills, and a strong desire to succeed also are important qualities for loan officers. Most employers also prefer applicants who are familiar with computers and their applications in banking.
The median annual salary of a Loan Officer is $53,000. The top 10 percent earn more than $106,000 annually, and the bottom 10 percent earn less than $31,000 annually. Median earnings in the industries employing the largest number of loan officers are:
- Depository Credit Intermediation - $59,130
- Nondepository Credit Intermediation - $64,670
- Activities Related to Credit Intermediation - $63,980
- Management of Companies and Enterprises - $65,050
- Insurance Carriers - $64,110
- 2006-2016 Employment growth: 11%
- Number of new jobs created 2006-2016: 43,000
- Employment 2006 : 373,000
- Employment 2016: 415,000