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How much money does the average mortgage broker make? What type of college degree is typical?

I've heard that if you are savvy and can sell, you can be driving Ferrari's after a few years in the business.  Any honest input is appreciated.

  • March 03 2010 - US
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Answers (15)

The original post was 2.5 yrs ago and well before the Dodd-Frank Act of March 2011. Along with numerous other restrictions on the mortgage/lending industry, lender/originator compensation was dramatically impacted. More Hyundai's then Ferrari's..........
  • August 06 2012
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Profile picture for user3204793
My broker was going to make 1.25% of 396000, about 4950, and then 50 vcredit report fee....but then when I wanted to lower my loan balance to 391790, the rebate for me was less.  I think he still wants to make his 5000.  Who knows how much he is making off the interest rate.....
  • August 06 2012
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Profile picture for tonygim
Most brokers do their best to collect 1.5% of the loan amount for their commission or $6000 for a $400,000 loan.  Some brokers try to get 2% or even higher. 

I observation and personal opinion is that less than 10% have a college degree.
  • March 03 2010
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A good LO can make six figures, but it isn't sitting on your rear. Lot's of stress from Realtors, buyers, attorneys. Be prepared to answer your cell phone on weekends or weeknights when people are home from work and can speak about their personal finances, or contracts are being written in Real Estate offices and pre-approvals are needed on the spot.
This is not a "steady paycheck" living...one month can be great with the next month being horrible. Loans may be declined, or purchases fall through and suddenly your "pipeline" of future income is reduced.
No paid vacations...you're basically self employed, no salary...usually 100% commission.
On the plus side: lot's of flexibility. I golf when I want, take a day off when I want...this is not 9 - 5. But I easily put in 60, 70 hours a week if not more. When business is good: you're working your tail off trying to capture as much as you can. When business is bad: you're working as much as you can to get what you can in the door.
If you do join this circus---save as much $$ as you can. Many LO's have spent every nickel they had when times were good thinking the money would keep rolling in. Lots of those guys are out of business right now.

Good Luck
  • March 03 2010
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I bought a house FHA back then; it was $160k and I had to put down enough to get to the FHA limit of $152k (limit in the area is now $729k); sold it 3  years later and received a check in the mail for the unused UFMIP.

yep, if I had to start now, I wouldn't.

  • March 03 2010
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Profile picture for David Widlund
I used to pick up my appraisals in the milk box at my appraiser's house. There were three copies, one for the underwriter's file, one for our file and one for the customer. Yes, glued on photos.

The only recommendations I can give for training are Training Pro, and Kaplan.

But I am still sticking to my original story, that if you are actually considering getting in this business right now, you need to have your head examined.

  • March 03 2010
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Calyx Point was in DOS!

Dplume, I had forgotten about the appraisals with the glued on photos! Thanks for that!

The Mortgage Credit Reports were $110!
  • March 03 2010
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I started in 1991; they handed me a box of business cards and rate sheets and said "go get 'em".

for those complaining how hard it is to do loans, I say "welcome to the 90s!" We didn't have DU, credit scores, email, digital photos, internet, cell phones.

we had thermal faxes, pagers, handwritten applications and manual underwriting. Appraisals were delivered by hand with 1 hour photos glued to them. credit reports took a few days and you had to know how to actually read them (no scores in those days). DTI on conventional was 28/33 and forget going over it.
  • March 03 2010
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Profile picture for timg2
Could you recommend any online classes that you have taken in the past that are reputable?
  • March 03 2010
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Profile picture for David Widlund
I think that might be a new question, but my here's my best shot:

Most of us learned on the job for many years during very loose times, when there was little to no regulation in Colorado, and loans were not scrutinized very much. Almost any bank would lend to anybody who looked like they MIGHT pay the loan back, or at least their property would be appreciating. That way if they had to take a property back, it would still be worth something.

It was very beneficial to most of us, because we didn't have to know a lot. If we could answer a few questions on an application and order a credit report, chances are, we could get a loan approved.

It is nothing like that now. There are major changes in state and Federal laws and regulations. Getting a file approved is harder than preparing a business tax return. It requires finesse, expertise, lots of proactive preparation and the mind of an underwriter, so you can predict problems before they happen.

Almost everyone in our industry in in shock and disbelief about how difficult it is to get loans done in comparison with even 4 years ago. We are all learning new rules. The guidelines change every single day, and you have to stay completely on top of it.

The 2nd answer is that we have had to take many classes and ongoing education over the past few years. We have licensing, registration, bonding, testing, fingerprinting and background tests.

You are left with some of the best loan officers in the past 15-20 years. They had to be, or they wouldn't have made it through the past 3 years.

To begin now, sounds insane to me.

Good Luck!

  • March 03 2010
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Profile picture for timg2
Did most of you get on the job training or take classes?  If you took classes were they online or local?
  • March 03 2010
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Profile picture for David Widlund
I think I actually agree with Nic...imagine that.

The best I have seen from some top-producers in the past 12 months is about $350,000/year. But that is someone who is plugged into a machine of an origination business with tons of support staff. He is also working 60+ hours a week, he is completely stressed out, and has no time for a family (just my perspective). I think the average L.O. is making between 50k and 80k.

An inexperienced loan officer is not going to come anywhere close to that number, and I have seen newbies chewed up and spit out in 3 or 4 months with no pay check.

I think the typical college education of an average to above-average loan originator is a bachelor's degree. There is no special education required, besides what is necessary under state and federal law. It's considered a sales job. Anyone in sales will tell you that if you're a good salesperson, you don't have to have any degree to do it, not even a HS diploma.

I don't know if this is the reason why you are asking, but anyone considering getting into the business right now is completely insane. Unless you have enough money to get you through 2 years of learning what you are doing, and building some sort of marketing and referral plan, it would be like smacking yourself in the face repeatedly.

Good luck!

  • March 03 2010
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It is just like any other sales profession.   The top 5% of originators have fantastic earnings capabilities.   The "average" ones bounce around from one employer to another and either scrape by or quit.

A bachelors degree is sufficient for this field.   No higher education will ever be relevant to loan origination.
  • March 03 2010
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I'd rather have the money in the bank than in a car. just traded in my 11 year old car (that I'd bought new) for a newer but used car. 
  • March 03 2010
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Don't know about a Ferrari but a good loan officer in a market like this can make 15 to 20k a month pretty easily.  An average one probably 4 to 5k a month. In a bad market who knows....
  • March 03 2010
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