Obviously, one of the first questions a person pursuing a career as a loan officer wants to know is how much does a loan officer makes. Valid question, but to be honest there is no clear answer to what a loan officer salary is because there are a lot of variables that come into play. It is certainly a worthwhile career, but in regards to loan officer salary, as we just stated there is no set wage. However, we will go into some factors that can and do matter regarding salary.
First off, the loan officer salary will vary depending on size of the employer or institution for which they will be working. Some loan officer jobs will be strictly salary, others will be solely commission-based and still some will be a combination of both. The most prevalent method is a combination salary/commission wage. This provides plenty of incentives for the person in this position to really get into gear and processes successful loans.
Then too, there are basically two types of loan officer positions. One is the commercial loan officer, in which they will be processing for the most part loans that are business-oriented in nature. Say for example, Acquisitions, Acquisition & Development, Asset-Based, Bridge Loans, Construction Loans, Debt Consolidation Loans, Development, Rehab and so on. In other words, commercial loans cover just about anything that is not mortgage-related.
And then we have the just mentioned mortgage loans. These are usually related to the purchase of residences and sometimes commercial or income type properties. The terms used for these kinds of loans are Fixed Rate, Federal Housing Authority (FDA), Veteran’s Administration (VA – utilized by military members), Adjustable Rate Mortgages (ARM) and some other lesser-known and used types related to Real Estate purchases.
Now, as far as base pay goes regarding the loan officer salary, a lot will depend on what part of the country you are located in. Just over $38,000 is the lowest we have found with just over $77,000 being the highest. Obviously if you are in an area with a higher cost of living you will be paid more to meet your living needs than if you are in a sparsely-populated area with lower expenses. Please be aware that these listed salaries did not indicate whether commissions were included.
Now, regarding commissions, you will almost always receive at least 1 percent of the total of the approved loan upon completion. However, the better you get at it there is a pretty good chance that your commission percentages are going to be increasing. Your employer is more than likely going to go out of their way to make sure a person is a happy customer.
It is also important to note that some banks especially may pay a loan officer a fixed salary and perhaps a set dollar amount as opposed to a percentage. So for example a loan officer’s salary may increase by $100 or whatever rate the bank has set for approved loans in addition to the base salary. And the most crucial thing to know about a loan career: the lower interest rates are the more loans you will see processed hence a likely increase in your loan officer salary.