A mortgage loan officer is an employee at a financial institution who specializes in handling mortgages. He or she works with people who want to purchase property to determine which sorts of loans are appropriate, and how much people can afford to borrow. The loan officer also acts as an intermediary between borrowers and the financial institution, often establishing a long-term relationship with the client.
Banks, lenders, credit unions, and mortgage brokers all have mortgage loan officers on their staffs. In some cases, a loan officer handles other types of loans in addition to mortgages, such as car loans and small business loans. This is especially common in small banks, where maintaining separate staffs for different kinds of loans would not be feasible.
As a general rule, a mortgage loan officer has a bachelor's degree in finance, business, or a related field. He or she may be trained by the financial institution, or by a vocational school which provides training to people who work in the financial sector. Pay is often based on commission, so the the more loans a mortgage loan officer secures, the higher the take home pay.
When people initially approach a financial institution for a loan, they are assigned a mortgage loan officer who reviews their case. In the course of an interview, the mortgage loan officer will learn about the lives of the applicants, and collect financial data which will be used to determine creditworthiness. Many financial institutions rely heavily on credit scoring systems to determine who to loan money to, but mortgage loan officers will also consider special circumstances when evaluating loan applicants.
A skilled mortgage loan officer will work with clients to reach a loan agreement which will work. If clients are not eligible for the type of mortgage they are applying for, the loan officer may offer alternatives or suggestions, or indicate that the clients should be seeking a smaller mortgage on a more affordable property. The loan officer must be able to balance the desire to sell a mortgage with concerns about the likelihood of repayment, as many banks learned to their chagrin in the subprime lending crisis which occurred in the United States in 2008, when thousands of people defaulted on mortgages they could not afford.
Mortgage loan officers usually work closely with realtors, and some real estate professionals have a preferred bank or mortgage officer, with an existing relationship which helps transactions run more smoothly. Work in this field usually requires excellent people skills along with the ability to assess financial situations quickly and accurately. Income can also fluctuate radically, especially when interest rates are high and the economy is at a low point, when less people are interested in purchasing homes, so the services of a mortgage loan officer are not needed.