Mortgage Lending
by Paul Donohue
In mortgage lending, what you don't know can hurt you. Saying that the mortgage
lending industry has changed in the last two decades is putting it mildly. It's more like a
seismic shift toward challenges at every step of the lending process - it’s even difficult for
some professionals to stay on top of it. Many people can no longer afford their current
mortgages, and a lot of potential buyers aren’t sure what kind of loans they can qualify for
anymore.
Requirements for underwriting and regulatory compliance rules seem to change daily. The volume of loans being originated and serviced is immense, making it difficult for a mortgage broker or firm to manage staffing and optimize costs. The role of an underwriter has always been to decide whether making a particular loan is a prudent investment. Over the last twenty years, this role has been modified and has increased as the mortgage lending industry has changed. What was perhaps a 'rubber stamp' job is now one of the most highly regarded positions in a mortgage banking firm.
You may be thinking about starting a career in the mortgage lending industry. The best time to seek a job in this industry is when the rates are low, because homeowners start to think about refinancing their existing loans and try to get a lower payment and, hopefully, a better rate. If you have a background in finance or real estate, there are a few mortgage lending jobs that may be of interest.
- Junior loan officers are responsible for doing most of the sales work for lending companies. They have to get on the phone pursuing leads, conduct necessary research and gather all of the paperwork needed to close each loan.
- The senior loan officer acts as a professional mentor to a junior loan officer and assists with completing and assembling packages for potential customers. The senior loan officer receives a percentage of each sale made by the junior officers he supervises.
- The loan processor works behind the scenes to process paperwork, call contacts for more information, ensure that the applications are complete, and send forms off to the underwriter for the loan.
- A mortgage broker basically takes on all of the duties of a loan officer, originator and loan processor (dealing with the paperwork). A broker must also act as a liaison between the bank and the borrower.
- The underwriter is responsible for approving or denying a loan application based on an established set of criteria. The decision takes into account the funds available to the borrower, their credit risk, the value of the home or property, and the borrower’s ability to pay back the loan.
As the mortgage lending industry continues to change, make sure you are prepared to be fully compliant with national standards and requirements. Receive pre-licensing and continuing education credits from Abacus Mortgage Training and Education, a leader in mortgage lending education and test preparation.
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© Copyright 2011 by Paul Donohue Presents (doing business as Abacus Mortgage Training & Education). All rights reserved. Printed in the United States of America. No part of this web site, its contents, texts, or graphics may be used or reproduced in any manner whatever without the express written consent of Paul Donohue.
All information about the nmls test, mortgage broker education, loan officer training and MLO requirements is gathered from government agencies that regulate the mortgage industry. Please check with your legal advisor to confirm all actions regarding your licensure.
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