Loan Originator: Career Profile, Job Outlook and Education Requirements

Loan originators, also known as loan officers, initiate the process of securing a loan. A bachelor's degree in finance, business, or a similar field is usually needed; some schools offer a certificate program in loan origination. Schools offering Finance degrees can also be found in these popular choices.

What You Need to Know

If you're interested in becoming a loan originator, you may consider obtaining a bachelor's degree in finance, business, or another related field. Though loan originators often receive on-the-job training, individuals with a degree have more employment opportunities. There are also courses, training programs, and various certifications available to those who desire a career as a loan originator.

Duties Review, authorize or recommend approval of loans for people or businesses
Projected Job Growth (2016-2026)* 11%; employment for loan officers in savings institutions and commercial banks is projected to grow by 3%
Education Bachelor's degree; classes may include real estate fraud, taxes, ethics, sales, marketing, underwriting

Source: *U.S. Bureau of Labor Statistics

What Does a Loan Originator Do?

Loan originators work for banks, mortgage companies, or other financial institutions and assist customers who wish to borrow money in order to finance a college education or purchase a car, house, or other expensive items and services. There is a significant amount of customer service involved in the work of loan originators. They use underwriting processes to determine if applicants are eligible for a loan. A lot of companies have underwriting software that makes a recommendation about whether an applicant should be approved based on their financial status. Some loan originators also act in a sales role and try to increase business by contacting potential customers. Here are common duties of a loan originator:

  • Identify individuals or companies in need of a loan
  • Gather required information from loan applicants
  • Discuss different kinds of loans and loan terms
  • Assess the financial status of applicants
  • Review loan documents to ensure compliance with regulations
  • Approve loans or refer to management

What Is the Projected Job Outlook?

The U.S. Bureau of Labor Statistics reported that, from 2016 to 2026, job growth for loan officers was expected to increase at a rate of eleven percent, which is faster than the national average. However, employment for loan officers who work in savings institutions and commercial banks is projected to grow by three percent. As of May 2017, the annual median salary for loan officers was $64,660, and those at the top of the industry usually made $135,590 or more per year, per BLS statistics; however, wages typically fluctuate depending upon the state of the economy. More than three-quarters of loan officers work for a financial institution, such as a bank or mortgage company. Individuals with experience in lending, banking, and sales have a better chance of securing a job in this field.

What Are the Educational Requirements?

Most companies that hire loan originators require applicants to have a bachelor's degree in finance, business, or a related field. Some colleges offer a certificate program for those interested in a career in loan origination; classes include real estate taxes, real estate fraud, ethics, sales and marketing, underwriting, real estate economics, real estate financing, and titling. American Bankers Association and Mortgage Bankers Association are two organizations that offer loan originators courses, training programs, and certifications. Many states require prospective loan originators to receive a license before they can accept a job in the field; some local schools offer training programs to help students pass these mandatory examinations.

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