Oftentimes, loan officers use special underwriting software, which looks at your finances and generates a recommendation. They typically use this software as well as their own review of your financial situation to help them come to an approval decision. Loan officers may also assist you through the loan application process or suggest products and services that are a good option for your particular needs and wants. For example, if you’re applying for a mortgage, you may work with a loan officer to secure your home loan. A loan officer can also be useful if you need a car loan, personal loan, student loan, or any other type of financing.
Alternate names: Loan specialist, collection analysts, loan servicing officers, loan underwriters, payday loan officers, mortgage loan officers
Loan officers often hold a bachelor’s degree in a business- or finance-related field. Those who don’t have a degree usually have work experience in banking, sales, or customer service. While each bank credit union, mortgage company, or other financial institution has its own training requirements, most of them have an in-house training program designed for new loan officers. For example, mortgage loan officers must complete courses and pass a national exam so they can obtain a mortgage loan originator (MLO) license.
How a Loan Officer Works
Loan officers can work at a variety of places and may work with different types of borrowers. They may contact you if they think you’re in need of a loan or to collect information and answer any questions you may have about the loan itself or the application process. If the application process requires a credit check or income verification, a loan officer will often take care of it. Some loan officers specialize in a specific part of the loan process, like underwriting or payment collection. For example, if you have a secured loan and fail to make payments, a loan officer may be the one to seize the collateral to repay the loan. Loan officers also approve loan applications or send them to upper management so that a decision can be made. They may also review loan agreements to ensure they comply with state and federal regulations.
Types of Loan Officers
Commercial Loan Officers
These loan officers offer business loans that help businesses cover the cost of equipment or operations. They usually collaborate with multiple banks to design a loan package that accommodates the large funding needs of many businesses.
Consumer Loan Officers
Consumer loan officers focus on personal loans that can help everyday individuals pay for a wedding, vacation, college, or anything else. While they may not be involved with the underwriting process, because it’s often automated, these loan officers often guide potential borrowers through the application process and help answer questions.
Mortgage Loan Officers
Mortgage loan officers focus on residential and commercial mortgages. They typically develop relationships with real estate agents and others who can refer them to prospective borrowers. They’ll likely be with the homebuyer through the entire homebuying process.
