Your Questions About Mortgage Loan Officer

Ken asks…

mortgage loan officer career?

I live in San Fransisco, CA. I have a friend told me that in order to get my license, all i have to do is to read the book called California Real Estate Principles. Once I’ve done reading the book, i can take the test and get my license. But does it takes like months or years to learn everything about real estate?
He makes minimum of 20k a month, is that really true? Can you really make that much or more? He works for a company not a bank that he does mortgage loans for seniors. Can i make that much money? Is that a really great career job? What’s the failure rate?
The reason why is because i don’t know if i want to do this or not? I want to make good money but i want to know what’s the pros and cons of being a mortgage loan officer? Is it worth it?
If i do a loan for someone that I’ll get 1 or 2% of that loan, is that true with any loans?
Thanks…

John answers:

There is a learning curve in order to earn this type of money on a regular basis. Some learn faster than others therefore you might be on a fast track.

There are those in this career that earn more than your friend. Then there are others in the career field that earn a lot less.

Your commission split would depend on the agreement you would make with your mortgage broker. Some mortgage brokers base the commission split with their loan officers on experience, while others base the split on the volume of business you are able to bring to the office or dollar amount you bring into the office..

Though the mortgage office might get 1% of the loan amount, your commission split would be what you have agreed with the mortgage broker could be 50% or more or could be less, depending on the agreement you have.

In order to obtain a loan officer’s license in California you would have to google loan officer license followed by California. There will be many sites that would be of assistance to you in the necessary steps you would have to take in order for you to obtain your loan officers license.

You might would want to see if you are able to speak with a person that is currently performing as a mortgage loan officer in your city and speak with this individual about the questions you would have, you might do the same with a mortgage broker to find out the possible commission split and the method used in determining this commission split. This would give you an insight as to what you could expect being a mortgage loan officer.

The primary thing you as a loan officer is you must have clients in order to earn your commission, therefore you would have to have an awesome marketing plan that would give you a continual number of clients. This would include networking with real estate agents, builders and developers as well as interaction with individuals that might need your services.

I hope this has been of some benefit to you, good luck.

“FIGHT ON”

Donald asks…

What kind of questions should you ask the loan officer when completing a mortgage application?

Really not sure about this, any advice would be very much appreciated.

John answers:

You should get the loan officer to explain his process for the application and approval process of your mortgage loan. After that you would have the floor to ask any question that pop into your mind, no matter how you think you would be perceived for asking the question. An informed applicant is able to make intelligent decisions.

Buying a house is a step by step process, this is the first step you should take in order to purchase a house. The rest of the steps will fall in place, no matter the type of property you are purchasing.

In order to find out the type of loan programs you are qualified for you will have to fill out a loan application, with a mortgage broker, you can find one in your local telephone book.

Make sure this mortgage broker or mortgage banker is able to do government loans such as USDA, FHA and VA loans if you qualify for one. With a VA mortgage loan you are not required to have a down payment, this will save you on closing cost.

He will fill out this application, which takes awhile so grab your favorite beverage and sit down. Once you have completed the application, he will run your credit report which will have your credit scores. These credit scores will determine your interest rate.

The amount of your monthly debt payments you are required to pay as per your credit report and the amount of mortgage you can take on based on your income will determine the amount of house you will be able to purchase.

When you speak with the mortgage broker you will need the following documents to complete the loan application, there will be others, but this will get you started.

#1 One month of pay stubs for each person that will be on the mortgage.

#2 Six months bank statements from each bank in which you bank as well as statements from any 401K from you place of employment.

#3 Two years of federal income tax along with the W-2 that match.

Once he has all that he need to do he can then issue you a pre-approval letter so you can purchase a home. In this pre-approval letter will be the amount of house you are qualified to purchased.

Once he gives you this pre-approval you may now find a real estate agent to find yourself a home or he might have a referral.

Now make sure before you get your pre-approval you and your mortgage broker go over all your options as to the mortgage programs you qualify for, the interest rate, monthly payments.

If you are getting a FHA, fixed rate, two loans to eliminate PMI like an 80/20 or one loan, if you are qualified for and approved for a 100% loan.

You should select the loan that best suit your financial condition at the time. That could be an adjustable rate loan. It could be a fixed rate loan for 5 or 10 years and then adjust. Some adjustable rate mortgages only adjust once.

Make sure your mortgage broker explain all your options so you may make an intelligent decision.

What might be good for one person might not be good for you, in other words just because your friends and all your real estate buddies are telling you about the great fixed rate they got, your financial situation might call for something else.

So select the best option for you and your financial situation.

You should also get a Good Faith Estimate (GFE) which will indicate the cost you will have to pay for getting this loan. It will also indicate the amount of your down payment.

Once you have found a home the real estate agent will then prepare a contract for you and the seller to sign.

Your mortgage broker will now order an appraisal to show proof of the property value.

The mortgage broker might ask for additional information or documentation, don’t get all up tight this is normal, just supply the information or find the documents needed.

After the appraisal has been completed you will be called by your mortgage broker to sign your loan docs so you can take possession of your new home.

Before signing any loan docs make sure they say exactly what you and your mortgage broker went over when you decided on what mortgage program was best for you.

I hope this has been of some benefit to you, good luck

“FIGHT ON”

Sandy asks…

is there a difference between a loan officer and a mortgage broker?

also, is mortgage consultant just another name for loan officer?

John answers:

A mortgage broker is a licensed person who can get banks to sign up with them if they meet the requirments of the bank. A loan officer is usually someone who works for that broker, and a Mortgage consultant does the same thing. There are many mortgage people out there who will use whatever seems most attactive for there title. I’m a person who does loans in MN and I consider myself a Loan Consultant. I work for a company who is approved with over 100 banks and I consult people on the bank that fit’s there needs. So there is a difference, but there is nothing regulating people in my business to a particular title.

Paul asks…

Loan officers?

IS there a program in California that helps you to get your real estate license and trains you basically?

John answers:

The easiest way is to go work for a large bank: BofA, Washington Mutual, Citibank … Etc. Major banks hire loan officers (often times no experience necessary) & they’ll give you the basic training you need, and you don’t need a real estate license! Wells Fargo is known for its in-depth, comprehensive training prgm. After you work as a loan officer at a bank for 1~2 yrs, you may consider stretching your wings by joining a mortgage broker, by then you’ll need to pass a state exam & get your license. The biggest upside of working for a major institution first is that you may get a nominal salary + good benefits while you learn to be a loan officer. Good luck!

Richard asks…

Mortgage Loan?

When my Fiance and I go for a mortgage loan will they look at both our incomes and credit score? And what are the determining factors for a loan officer to give you a loan?

John answers:

If you are both going to be on the loan, then both incomes will count. Critereia for a mortgage is dependent on the following:

* Credit Score – there are 3 credit bureaus and this thing called a FICO (Fair Issac) score. The closer your score is to 850 the easier the loan is to get and the better rate (lower interest) you will be offered.

* Debt to income ratio. If you earn $1,000 a month and have $750 per month in bills to pay, it will be tougher. Banks/mortgage companies like debt to income to be less than 50%, and would prefer 30% area.

* Don’t be getting new loans and don’t apply for new credit until after you have purchased your new home. These “inquiries” will bring down your credit score.

Look up your credit online now. You can get it done very inexpensively and know where you stand.

Hope that help

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