No Two Days Are Ever The Same
When you’re buying or selling a home one of the most common pieces of advice you’ll hear is “find the right Realtor!” What you’ll almost never hear is any kind of discussion about finding the right loan officer. Too many borrowers unfortunately see loan officers as a necessary evil, someone they have to interact with but ultimately want as little contact as possible with during the loan process.
The truth of the matter is that a loan officer is much more than someone who nitpicks over documents and then has you sign some paperwork. They’re an advocate for you and your purchase, and the right one can make all the difference in closing on your dream home. Understanding just how important your loan officer is starts by understanding what they do on a daily basis.
What is a Loan Officer?
In the simplest of terms a loan officer (or LO) is an individual retained by the borrower to help them secure a loan. This is much more than simply accepting an application- a good loan officer will advise borrowers on programs they might be eligible for, assist them in getting the proper documentation, and handle communication between the borrower and staff working on the loan. In the same way that a Realtor handles the nuts and bolts of buying and selling property a loan officer handles all the details that go into the securing the financing. That includes staying in constant contact with the appraiser, underwriter, and title company to ensure everything is ready in time for closing.
Is a Loan Officer the Same Thing as a Mortgage Broker?
Yes and no! A loan officer can be either a mortgage broker or a mortgage banker but each secures your loan funds from a different source.
A mortgage broker acts as an intermediary between you and other financial institutions. They will take your application and look around for who’s offering the best deal. Once your file has been submitted they’ll have limited control over the remainder of the process beyond simple communication and updates.
A mortgage banker works for one financial institution and will offer you different products available from their bank. Working with just one company gives them added insight into how well your loan will do once it’s submitted to underwriting.
A loan officer can describe either a mortgage broker OR a mortgage banker, so be sure to ask when seeking out the right professional for you.
How Do You Become a Loan Officer?
Most loan officers are licensed by a state authority. This demonstrates that they have met or passed the knowledge and capability requirements for the job, often including a background check. Personality-wise the profession draws individuals who are people oriented, highly organized, and methodical problem solvers. Although college degrees aren’t always required many Loan officers do have a background in business or finance.
What Does a Loan Officer Do Each Day?
Plenty! The bulk of any loan officer’s job is communicating, first with their new borrowers and next concerning their loans in progress.
A loan officer will talk to new borrowers about their goals and take a look at their financial situation. The loan officer will then use their training to determine what loans the borrower might qualify for and the documentation they would need to provide.
After new borrowers have been communicated with the loan officer will need to check the status of loans in progress. This part involves quite a bit of calling and emailing as the LO makes sure that each loan application is moving forward (and if not, why not). For example, a Realtor could demand an update on a loan that is closing soon and the loan officer will need to have that information ready to provide: what is the loan’s status, are there any holdups, and will it be ready for closing?
During this time current borrowers may be calling for updates, which means that the loan officer will need to allocate time to discuss the status of these loans. No day is the same in the life of a loan officer.
Can I Skip The Loan Officer?
Many large banks have either eliminated loan officers or reduced the responsibility of the position completely. While it may sound tempting to do everything from behind the computer don’t discount the value of face to face communication. Part of a loan officer’s job is evaluating a loan applicant and helping them devise a plan to qualify for a loan! If you leave the loan officer out of the equation you take away a valuable advocate who can fight for you when the loan gets tough.
Next time you’re buying a home we hope that you’ll think about the importance of having a qualified loan officer on your team. If you ever need a recommendation remember: at Service First we’re dedicated to getting our clients qualified and closing loans. Give us a call!
If you’re ready to get started on your home buying journey, we can help!
Contact us today!