Did you know that there are 688,327 active state mortgage loan officer licensees (Loan Officers) according to the CSBS 2020 MLO Report? That’s a lot of lenders.
If you’ve been in the industry a while or have purchased a number of real estate properties, you may agree with the realization that not all lenders are created equal.
The overall service that a loan officer provides will boil down to 3 things:
Their experience
Their lender
Their motivation
The number of mortgage loan officer applications increased 74% from 2019 to 2020. You don’t have to be math wizard to realize that the mortgage industry is now saturated with a lot of mortgage loan officers who have less than three years of experience. When making the largest purchase of your life, wouldn’t you feel better knowing that your loan officer has the experience necessary to make the home financing process smooth for you and your family?
Some might exaggerate the amount of experience they have as well. Some loan officers may say they have 20 years of experience, but that may only be 3 loans per year. A lot changes in the mortgage industry in a short amount of time. If you can verify that your loan officer has experience closing at least 25-50 deals per year, then it’s safe to assume that they’re working full-time in the home loan business and are likely kept up to date with industry and important regulatory guidelines. Two ways to verify your loan officer’s experience would include:
1. Their NMLS ID number – you can search for your loan officer’s ID number at https://www.nmlsconsumeraccess.org/. This site will provide dates regarding how long they’ve been licensed.
2. How many home loans your loan officer has closed – this information can be accessed at https://modexconnect.com/. This site will provide information regarding how many closings, how much volume, and how the loan officer ranks within his/her company.
Mortgage loan officers can be limited on pricing, i.e. interest rates, lender fees, etc… depending on the lender that they work for. It’s important to always get a couple of quotes from a few different lenders and have an unbiased (but knowledgeable) 3rd party explain and compare the quotes to you.
IMPORTANT NOTE: With very few exceptions, real estate agents are NOT licensed mortgage loan officers and would not qualify as a truly unbiased 3rd party expert to help compare your quotes. Some real estate agents have lead cost sharing agreements or office lease agreements with lenders and this could bias their opinion of which lender you should work with. So be careful!
The most accurate quote that you can get from a lender is known as a LOAN ESTIMATE. On the loan estimate, page 2, you will see “Section A. – Origination Charges”. These are the only fees that a lender has control over. They typically will include an origination fee and/or discount fees.
VETERANS: If you’re using your VA home loan benefit and the lender is charging you an origination fee (Section A of the Loan Estimate), it is important to know that there hundreds of other legitimate lending institutions that charge no origination fee for VA loans. In other words, your closing costs may be higher if you're paying for an unnecessary origination fee.
When comparing loan estimates, do not just compare the interest rate! The lender with a lower interest rate could be making up for that benefit to you buy charging you an origination fee and/or discount fees! Or they simply may not be able to actually close your loan or close your loan on time.
Lastly, when it comes to observing for your loan officer’s motivation, you should be able to figure it out pretty quickly if you can do this:
Call the loan officer after normal working hours. The motivated loan officers will at least send you a text message back in response to make sure everything’s okay. If you call your loan officer on a Friday or Saturday evening and they don’t respond in any way until the following Monday, then it may be time to reassess how motivated your loan officer is to provide you the help when you need it.
After you provide your loan officer your completed home loan application, how long does it take for them to contact you back and go over next steps? If it’s more than 1 day, then again, you may want to reassess how motivated your loan officer is to provide you the service that you deserve.
Top producing loan officers and real estate agents define great service by how effective the communication is (with all parties) throughout the whole process and the ability to close your deal ON-TIME!
If your loan officer is experienced, has great loan options to provide, and is motivated, then they should be able to provide you a link to their client testimonials. No one is perfect! Especially loan officers. So if you see a lower client rating once in a while, remember, the home buying process can be long and stressful. However, the great loan officers should be able to provide a rolodex of hundreds, if not thousands of highly rated client reviews.
Like what you're reading? Check out more articles like this at TheHomeLoanHub.com.
Terry Roberts is a U.S. Marine Corps Veteran and specializes in residential mortgages, including new construction, conventional, FHA, and VA home loans. He has helped more than 10,000 clients start the home buying process across America.
Terry Roberts, USMC Veteran | Sr. Loan Officer NMLS 397987 | E Mortgage Capital
With a rich background spanning over a decade in the mortgage and real estate sectors, Terry Roberts has become a cornerstone in guiding over 10,000 clients through the complexities of the home purchasing journey in the United States. His expertise covers a broad spectrum of housing loans including conventional, FHA, VA, and cutting-edge new construction financing options.
Emerging from challenging early life circumstances, including teenage parenthood, dropping out of high school, and facing homelessness, Terry's determination led him to serve in the US Marine Corps. This decision was driven by a commitment to safeguarding freedom and securing a better future for his family. His active duty service in the US Marine Corps, marked by nearly a decade of dedication, instilled in him a profound desire to assist fellow Americans in achieving homeownership, a cornerstone of the American dream that he fiercely believes in.
Terry leverages his profound understanding of the real estate market to empower individuals in their pursuit of property ownership as a strategic investment for wealth generation. His journey from adversity to becoming a beacon of hope and guidance in the real estate domain is not just inspiring but a testament to his commitment to his clients' success.
Connect with Terry Roberts, a proud USMC Veteran and Senior Mortgage Broker (NMLS 397987), for expert guidance on your path to homeownership. Visit www.TerryRoberts.com at E Mortgage Capital, where every client's dream is approached with the respect and dedication it deserves.
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