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Becoming a Loan Officer: What You Need to Know

Published on January 2, 2018

Do you enjoy working with money and helping people? A career as a loan officer just might be the future you're looking for. This dynamic career was ranked number 14 in U.S. News and World Report's Best Business Jobs. Here's what you need to know about how to become a loan officer.

What Does a Loan Officer Do?

Loan officers meet with people who want to borrow money. As a loan officer, you'll work closely with borrowers throughout the lending process. This can include gathering financial information, explaining different types of loans, filling out necessary paperwork, and seeking approval for loans.

Most loan officers specialize in one type of lending, such as mortgages, commercial lending, or consumer lending. Mortgage loan officers are also called mortgage loan originators.

Much of a loan officer's business comes from referrals, so it's important to establish a good relationship with your clients. Loan officers also directly contact businesses and individuals to see if they'd like to apply for a loan.

Education and Training Needed to Become a Loan Officer

Before becoming a loan officer, most applicants earn a bachelor's degree. This is usually in finance or business. However, some people become loan officers after gaining related experience, such as customer service or sales in a financial environment.

Loan officer training often takes place on the job. Some education and continuing education is needed for state licensing requirements.

Loan Officer Licensing Requirements

Loan officers are required to become licensed, and licensing requirements vary by state. In Washington, DC, loan officers need to pass a criminal background check and submit a credit report before becoming licensed. Loan officers also need to pass a test with both national and state components. Finally, loan officers must complete a set number of education hours of courses on laws, regulations, and professional ethics.

Personality Traits of a Good Loan Officer

There are several personality factors that will determine your success as a loan officer. Becoming a loan officer is for you if:

  • You have an outgoing personality. Successful loan officers have to be willing to work closely with all types of people. Since referrals can make or break your business, you need to be likeable and charismatic.
  • You're a self-starter. Motivation is important for loan officers, especially when you're just starting out. Persistence and a sales mentality of always looking for business helps loan officers do well. Setting goals for yourself is an important part of succeeding as a loan officer.
  • You have a professional attitude. Clients are trusting you to help them with some of the biggest purchases of their lives. It's important for you to take that trust seriously and be as professional as possible.
  • You're organized. Organization is key to keeping track of loans. As a loan officer, you'll need to keep track of many loans in various states of progress. It's also important for you to be organized so you can respond to client phone calls and emails quickly.
  • You have a thirst for knowledge. It's important for loan officers to be knowledgeable about the loan products they recommend. You might not know everything on your first day, but you should be willing to learn quickly in order to help advise your clients.
  • You deal with stress well. Like any job working with the public, the position of a loan officer can sometimes be stressful. If you can deal with that stress in a calm manner, your career as a loan officer is likely to be lucrative.

The process of becoming a loan officer isn't difficult. For the right person, working as a loan officer can be a rewarding and prosperous career path.