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An employee of a financial institution, charged with the responsibility of generating loan business for his or her employer and assisting in all details necessary to complete the loan application process.Sometimes the loan officer also monitors the relationship with the borrower after the loan closes;other times this is taken over by someone else.
Employees of lenders or mortgage brokers who find bor- rowers,sell and counsel them,and take applications.
Loan officers employed by mortgage brokers may also be involved in loan processing. In the case of a one-person mortgage broker firm, that person is both the broker and the loan officer.
While loan officers are employees, they act more like independent contractors. They are compensated largely, if not entirely, on a commission basis. The typical commission rate is 1/2 of 1% of the loan amount, and successful loan officers earn six figure incomes.
Both lenders and mortgage brokers post prices with loan officers to be offered to consumers. The loan officers usually have limited discretion to reduce the price if necessary to meet competition, and full discretion to raise the price if they can. The difference between the posted price and the price charged the consumer is called an Overage, and the loan officer usually gets a share of it.