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.
Popular Mortgage Terms
An interest rate index that is used on some ARMs. ...
The array of laws and regulations dictating the information that must be disclosed to mortgage borrowers, and the method and timing of disclosure. ...
An agreement between a mortgage borrower in distress and the lender that allows the borrower to sell the house and remit the proceeds to the lender. A short sale is an alternative to ...
The frequency of rate adjustments on an ARM after the initial rate period is over. The rate adjustment period is sometimes but not always the same as the initial rate period. As an example, ...
A documentation option where the applicant's income is disclosed and verified but not used in qualifying the borrower. The conventional maximum ratios of expense to income are not ...
A bundle of mortgage characteristics that lenders view as comprising a distinct category. The characteristics used include whether it is an FRM, ARM, or Balloon, the term, the initial ...
A payment made by a lender to a mortgage broker for delivering an above-par loan. A par loan is one on which the lender charges zero points. Lenders charge points on loans carrying ...
The portion of the monthly payment that is used to reduce the loan balance. ...
An upfront cash payment required by the lender as part of the charge for the loan, expressed as a percent of the loan amount; e.g., '3 points' means a charge equal to 3% of the loan ...
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