Loan Officers: Salary, career path, job outlook, education and more
- Education Required
- Loan officers typically need a bachelors degree, usually in a field such as business or finance. Because commercial loan officers analyze the finances of businesses applying for credit, they need to understand general business accounting, including how to read financial statements.
- Training Required
- Once hired, loan officers usually receive some on-the-job training. This may be a combination of formal, company-sponsored training and informal training during the first few months on the job.
- Job Outlook
The projected percent change in employment from 2016 to 2026: 11% (Faster than average)
(The average growth rate for all occupations is 7 percent.)
- Mortgage loan officers must have a Mortgage Loan Originator (MLO) license. To become licensed, they must complete at least 20 hours of coursework, pass an exam, and submit to background and credit checks. Licenses must be renewed annually, and individual states may have additional requirements.
- Median pay: How much do Loan Officers make?
- $63,650 Annual Salary
- $30.60 per hour
Loan officers evaluate, authorize, or recommend approval of loan applications for people and businesses.
What do Loan Officers do?
Loan officers typically do the following:
- Contact companies or people to ask if they need a loan
- Meet with loan applicants to gather personal information and answer questions
- Explain different types of loans and the terms of each type to applicants
- Obtain, verify, and analyze the applicants financial information, such as the credit rating and income level
- Review loan agreements to ensure that they comply with federal and state regulations
- Approve loan applications or refer them to management for a decision
Loan officers use a process called underwriting to assess whether applicants qualify for loans. After collecting and verifying all the required financial documents, the loan officer evaluates the information they obtain to determine the applicants need for a loan and ability to pay back the loan. Most firms use underwriting software, which produces a recommendation for the loan based on the applicants financial status. After the underwriting software produces a recommendation, loan officers review the output of the software and consider any additional information to make a final decision.
The work of loan officers has sizable customer-service and sales components. Loan officers often answer questions and guide customers through the application process. In addition, many loan officers must market the products and services of their lending institution and actively solicit new business.
The following are common types of loan officers: