Job Description of Loan Officer

A loan officer is a professional whose job it is to set up secured loans and other lending arrangements. Since the responsibilities and working environments of loan officers can vary widely, it is hard to summarize the job description.

Most loan officers work directly for banks and other financial institutions. These entities generally employ two different kinds of loan officer. The most common kind of loan officer or loan specialist works directly with the public, helping customers arrange for loans. The second kind of loan officer examines agreements for secured loans and other kinds of financing and approves them.

The standard loan officer in a modern financial institution will usually specialize in one particular kind of loan such as business loans, home loans or mortgages. In smaller banks, officers may handle diverse financial products.

Education, Licensing and Certification

Traditionally, most of the education for secured loan officers was received through on-the-job training. Financial institutions would run training courses and seminars for employees and job candidates.

Today, more and more banks and other institutions expect loan officers to have a bachelor's degree in a subject like mathematics, finance, business administration, or statistics. Many training programs only take candidates with such a background. Many finance companies do run training programs for franchisees and brokers entering the field.

Most states now require some sort of licensing for secured loan officers such as mortgage brokers. These licensing programs are similar to those for insurance agents and realtors. In most cases, a candidate will have to take a test demonstrating familiarity with loan regulation to earn this license.

Many training courses prepare individuals for these tests. A person should be able to learn what licensing requirements exist in their jurisdiction through their state government's website. Licensing is usually not required for those who work for banks and other financial institutions.

Certification is not generally required by the states, but it is required for some positions. Many firms and institutions have their own certification programs for secured loan professionals. There are also online courses and certificates for loan officers offered by some colleges. In many cases, these degrees are designed to familiarize individuals with finance and financial laws.

Work Conditions

Most loans officers work for institutions such as finance companies and banks. Some also work for government on all levels, including the federal level.

Secured loans officers spend a lot of their time preparing and examining paperwork. Today, most of this work is done on the computer and so proficiency with basic business programs such as Microsoft Office is necessary. Familiarity with software used in the industry is also vital.

Independent Brokers

Many loans officers work as independent brokers. Many of these are franchisees for major financial companies who sell products such as mortgages and other secured loans.

The advantage to these arrangements is that they give brokers a high degree of independence. Unfortunately, there can be little financial security for brokers in these arrangements because the only income they earn is from commissions. Those who become good at it can make large incomes.

Something to consider is that independent brokers have the expense of setting up and maintaining their own office. They also have to handle such aspects of the business as advertising, themselves.

Secured loans officers who work directly for governments, banks and finance companies may do less work but they earn lower incomes. Many of these individuals also have to put up with a lot of bureaucracy and a rigid structure.

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