Is it Time to Change Horses in the Middle of the Stream? Join the Mortgage Industry!

Is it Time to Change Horses in the Middle of the Stream?

As the coronavirus numbers surge again, other news is similarly abysmal. Take this, for example, from abcNews7: “Disney announces 28,000 layoffs amid continued closure of Disneyland”. WHAT??!!

But, not to worry. As recently reported here in, “Soldier On: The Forgotten Soldiers of Home Loan Financing”, interest rates are still low and the mortgage business is still on fire. Just in case any of Disney’s workers or employees of multitudinous other companies (that are closing, becoming smaller, or laying off staff due to Covid-19) are seeking new careers, consider the mortgage industry! In today’s blog, we’ll delineate just how you might accomplish that.

What Are You Made Of?

First, decide if you’d like to be in sales or “back end” operations. Sales typically generates more income but may require things like weekend work and/or longer hours in general, a salesy personality (including the ability to make successful cold calls), organization and the ubiquitous “people” skills, etc. According to Sales Hacker, you should be everything below if you want to wildly succeed:

“Upbeat
Passionate
Creative
Empathetic
Accountable
Well Prepared
Tech-Savvy
Highly Engaged
Goal Oriented
Relationship Driven”

In my humble opinion, you should also have some knowledge about and contacts in real estate. And a few masochistic tendencies can’t hurt either. (Little joke … sort of.)

For the sake of this blog, let’s assume you are a greedy, money-motivated goof and choose to become a Mortgage Loan Officer. (I can say that since I was one for several years, so lighten up!) Your next decision is whether to be an inside loan officer, an external loan officer, or a mortgage broker.

IMLO

In very brief, inside mortgage loan officers normally work in call centers, banks, or credit unions who employ people to take information via phone or the internet or sometimes in person. This class of mortgage sales people tends to react more than be proactive, although when the market is slow they will need to be plenty proactive. This class also tends to work set hours either from an office, bank, or home. They also might make less than an “outside” mortgage loan officer. How much is that?

Let’s look at those working for Quicken, the largest stated #1 online lender in the US. Per Glassdoor:

“The typical Quicken Loans Mortgage Loan Officer salary is $26,547. Mortgage Loan Officer salaries at Quicken Loans can range from $20,668 - $55,086. This estimate is based upon 58 Quicken Loans Mortgage Loan Officer salary report(s) provided by employees or estimated based upon statistical methods.”

On the flip side, I coach some mortgage executives who tell me they have numerous MLOs (the external kind) who have made over $1 million already this year. No, that is not a typo. To be clear, those high earners probably work insane hours, most likely have teams of people they personally trained carrying part of the load, provide incredible service, and have a boat load of sources of leads. And there’s more ….

Licensing and Other Required Processes

Some banks require their mortgage sales staff to hold college degrees. And all non-bank mortgage companies require their loan officers to be licensed. And, yes, you bet. There are costs associated with that which may vary by state. In California for example, here are the necessary steps:

Apply online for an NMLS account and ID number.
Complete your Pre-License Education.
Pass your licensing exam with a – 75% Passing Score or better.
Apply for a license with the NMLS.
Complete your background checks and pay all related fees.
Associate your NMLS account with an employer (Sponsor)

Let’s dive into these. Here are some sample charges from Mortgage Educators and Compliance.

Too confusing for you? This will clear it up for you. 👎

Woo Hoo and Yee Haw! (The next time someone compares a Mortgage Loan Officer to a used car salesman, please reference this blog!) Of course, if all of that seems to be too personally arduous, perhaps you would consider training people to become MLOs. The employees of these companies and many, many more apparently did.

Next, let’s discuss the differences between an external MLO and a mortgage broker.

What’s the Dif?

In very brief, MLOs offer financing from the financial institution where they work. Occasionally, they may have the opportunity to use some other lenders with whom their employer has a contractual relationship. MLOs are sales people. Unless they work with a federally chartered bank and are registered with that bank, they must be licensed, per above.

A mortgage broker, however, has many financial institutions from which to choose. Presumably and ideally, the broker knows each company and will meet your needs with the financial firm that best meets those needs. Mortgage brokers act a bit more like mortgage business owners.

There are numerous pros and cons regarding becoming a MLO versus a mortgage broker. For a list of many of those, go to Study.com, Magnify Money or Mortgage1.

So far, we’ve discussed the mortgage sales positions. Perhaps you’d prefer something rose. Consider these mortgage options:

The Worker Bees

Mortgage Loan Processor: A processor typically collects all needed documentation to submit the loan application. That includes the home appraisal, the credit report(s), title insurance, etc. There is a deadline for completing, verifying, and submitting all of this data.

Loan Underwriter: Today, most mortgage applications go through both automated and manual (human) underwriting. Automation helps speed up the process, but manual underwriters dig into the nitty-gritty details to make sure every detail is correct.

Loan Closer: A mortgage loan closer reviews all submitted data and paperwork then prepares closing documents, such as the final closing disclosures and estimated settlement statements. Afterwards, this must all be sent to all involved parties, including the borrowers, agents, escrow, title and confirm the accuracy of the submitted data with clear collaboration and communication.

This is by no means an exhaustive list. Lenders may also have receptionists or team loan officers/loan officer assistants. All of this varies by company and state and team. And then there are closing attorneys, escrow agents, appraisers … with a business that’s booming like the mortgage industry is right now, there is definitely an opening for you. But before you change careers or switch to a new lender, let’s have some fun.

A man in a hot air balloon realized he was lost. He reduced altitude and spotted a woman below. He descended a bit more and shouted, "Excuse me, can you help me? I promised a friend I would meet him an hour ago, but I don't know where I am."

The woman below replied, "You are in a hot air balloon hovering approximately 30 feet above the ground. You are between 40 and 41 degrees north latitude and between 59 and 60 degrees west longitude."

"You must be an underwriter," said the balloonist.

"I am," replied the woman. "How did you know?"

"Well," answered the balloonist, "everything you told me is technically correct, but I have no idea what to make of your information, and the fact is I am still lost. Frankly, you’ve not been much help so far."

The woman below responded, "You must be an loan officer"

"I am," replied the balloonist, "but how did you know?"

"Well," said the woman, "you don´t know where you are or where you are going. You have made a promise which you cannot keep and expect someone else to fix it for you. The fact is you are in exactly the same position you were in before we met, but now, somehow, it's my fault!"