Every week I receive many emails from loan officers dissatisfied with their small commission checks, looking for something better within the industry. They learned the mortgage business inside and out, and have made the necessary sacrifices to put their career on firm standing. Not satisfied with the measly yield and basis points of their current company is paying, they look at other options and exit.
You May recall in a previous article, I mentioned that:
"When I first started in the industry, my commission spread was 20% of the yield spread premium or YSP. And if that was not bad enough, we worked in teams of three people-two loan officers iprocesor. This meant that any commissions I and my team earned, had to be divided into three ways among all of us. I'm not kidding! My commission after all was said and done was a measly 6.5 to 7.0% of the YSP. So, the $ 3,000 loan, I would be around $ 200 at most. You do not want to see what it looked like after the taxes out. absolutely pitiful. Being in the dark (in the mortgage industry), I was not stupid. "- End quote
.If you are currently working as a loan officer, and I want to know your career options, here are a few to consider:
Option 1: Become a full mortgage brokers and to open our mortgage company
.This is actually the only way you'll get 100% commission and be able to dictate life on your own terms. However, there are several obstacles have to overcome, as well as disadvantages. One of the biggest obstacles is that many states require a certain level of capital that will be held in reserve before you can even get a license.
Many states have personal net worth too many requests and not even allow you to do anything under its own license until they can meet the standards set. Of course, there are experience requirements as well as the background check that is part of the process, as well.
It will not only have to sell loans, but process them, market your business, and handle all back-office administrative and legal requirements. Not to mention, your choice of lenders use to be extremely limited as the lenders themselves have their own criteria, even before it will approve a business. Mortgage broker exclusively on its own under its license sounds great at first glance, but only if you have personal and financial courage to time inevitable hiccups.
Option 2: Become your own banker and a mortgage to finance their deals with
.This is not really apply to you if you are the first commercial mortgage broker under his license. Many brokers are becoming big enough to where they make the transition from broker to lender. The reasons for this are obvious. Warehouse lines of credit, if provided with the right resources, can provide the banker with an even higher yield spread than if they simply stuck to being a broker and going off another lender rate sheets. In this case, as a banker, you can create your own 'stop lists' and set your own commission levels to expand. Some mortgage bankers even go into wholesale lending and other food broker loans in them.
financing mortgage banking may come from different sources, such as warehouse lines, outside investors, etc. And the state and federal regulatory rules and regulations vary. One of the main advantages of mortgage banking is that you can set their own lending criteria and can approve loans that others consider too risky.
One of the most moving examples of mortgage brokers in the mortgage lender, Ditech's funding. (I'm sure you've seen their commercials with the figure of a loan officer!). I was told that their wholesale line comes from GMAC, Ditech, and that is their biggest client. It can be some day!
mortgage banking is certainly something to consider if you already have your mortgage broker with its own license.
Option 3: Leave your business and join a net branch as your own manager
.become a net branch is probably the best of both worlds. You're on your own mortgage, their subsidiaries, but maintained much control over day-to-day operations of the company. Home Office deals with all the background things like accounting, legal and regulatory requirements. They also have established relationships with national lenders, many numbering in the hundreds. They can set up quickly and provide structure and support system to help you succeed.
commission extends from net branches vary, but most companies require a minimum past experience of at least two to five years, showing a track record of success. Some companies have set split yield spread, as is 70% for you and 30% of them. Others give you 90% or even a full 100%, but charge a fixed fee per file, to between $ 300 to as high as $ 600 loan. Although 100% sounds great, I've heard stories of even higher charges a fixed fee file out there!
If the net branch has no fixed divided by the loan, they May mark-up their rate sheets they give you and take extra expansion. For example, the lender sends the net daily rate of branch, net branch home office which means until then, and sends him off you. I never see the "real " rates! Are you a price off already marked-up rate sheet and never even aware of it! The secret, eh? Not all companies do this, but some do not!
Also, with net branches, even though you're on your own, you still have to follow set rules and procedures file. A company will have other unknown requirements and various corporate policies. However, you will not find you while you're in the process and committed to them.
It's funny, many mortgage companies are really net branches in disguise. Maybe even the company you work for now! That's right! They were probably used to small little one-person net branch at some point too! But those grown-up, expanded and hired people to work for them. You can do it! This is a definite possibility.
Overall, the net branches are an excellent way to "own your own business" without all the headaches and hassles that go along with it. However, a word of caution: Research each company thoroughly before you join and do not make any rush decisions
.Some of the largest net branch out there are: Allied Capital Corporation, Carteret Mortgage, Mortgage Allfund, Global Home Loans, Mortgage Summit, etc. (There are literally hundreds of choices, these are just some!)
Option 4: Stay as a loan officer
.If you become a broker, a banker or a net branch manager does not appeal to you, you can always remain as a loan officer and a change in the company. If you do not want responsibility of running your own shop, why not simply move on to greener pastures.
There are many mortgage companies - even within their own town - which is likely to pay much more than what you are getting at present. Why not a little look around and see what other guys are paying? It does not hurt to ask. Remember, as a loan officer is really a salesman. I work on commission, meaning that most companies will hire you with little hesitation (provided that the educational and professional background). It is a small risk that if it fails, because if you do not sell, you will not get paid.
Do not be afraid to look elsewhere, because if you stay where you are, you'll never get ahead.
Option 5: Move to another area of the mortgage industry
.As you know, I work in training and help loan officers and mortgage brokers to succeed in the industry. I've been there and done that already. After selling and closing thousands of loans, I know what works and what does not. When I got burnt out from the origin with a full-time job, I decided to use my knowledge and experience to train others.
Thus, I am still part of the mortgage industry I love and have all the freedom and control over their lives they want. You can do the same. This industry is in dire need of professional trainers. Like many people I have spoken, I am sure that your training was not much more than a cold telephone pole and a pair of leads. Mortgage training is a great place to consider.
and if you do not mortgage training, why not become an appraiser, title company owners, real estate attorney, loan processor, notary public, underwriter, wholesale account representative, etc. These are all great careers and are still in the mortgage area.
In the end, where you go in the mortgage business is entirely up to you. the sky is the limit and your opportunities are endless. I've only just opened my eyes to some of them.
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