Loan Officer

Employees of lenders or mortgage brokers who find borrowers, sell and counsel them,
and take applications. Loan officers employed by mortgage brokers may also be involved in loan
processing. In the case of a one-person mortgage broker firm, that person is both the broker and the
loan officer. While loan officers are employees, they act more like independent contractors. They are
compensated largely, if not entirely, on a commission basis. The typical commission rate is 1/2 of 1%
of the loan amount, and successful loan officers earn six figure incomes. Both lenders and mortgage
brokers post prices with loan officers to be offered to consumers. The loan officers usually have
limited discretion to reduce the price if necessary to meet competition, and full discretion to raise
the price if they can. The difference between the posted price and the price charged the consumer is
called an Overage, and the loan officer usually gets a share of it.