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How Do Loan Officers Get Paid?

In the mortgage industry, how do loan officers get paid? What do they do, how much do they make, and what qualifications are required for the position? As a loan officer, you’ll likely be earning more money than the majority of the population.

Job description

The amount of income loan officers make depends on their employer. While some work on a base salary, others earn a high commission on loan sales. This commission varies from firm to firm but typically runs between 76 and 150 basis points per loan. On a $100,000 loan, that translates to a commission of $760. However, this rate is only available if the loan officer has a substantial business book.


How Do Loan Officers Get Paid?

As one of the most sought-after jobs, the salary of loan officers varies widely. Generally, retail bank loan officers make much less than their counterparts at larger financial institutions. Most loan officers are relatively permanent in their positions and earn a base salary or commission on their sales. Those with years of experience and a substantial business book are often offered six-figure bonuses to leave their previous company. In addition to base salaries, loan officers may also earn additional income through bonuses or mega bonuses from other companies.


The first and most obvious issue with loan officers’ commissions is their conflict of interest. Commissions represent a disproportionate share of the total loan amount, with a higher commission rate for larger loans. This practice exacerbated the mortgage crisis in 2008 when banks aggressively pushed mortgages that borrowers couldn’t afford while loan officers received large commissions for intermediating. Fortunately, there are many alternatives to commissions.


Loan officers must have a thorough understanding of lending rules and regulations at state and federal levels. They must also have exceptional sales skills and a customer service-oriented approach. Some institutions and firms expect loan officers to develop their client base. The job requires considerable interpersonal skills, especially in the area of communication. Here are the qualifications of loan officers:

Job satisfaction

According to an Owl Guru survey, job satisfaction for loan officers is high. 53% of loan officers say their jobs are meaningful, with 74% rating their job satisfaction as very high. This is not surprising, as loan officers deal with the public daily. While only 2% of loan officers report talking to angry customers daily, they typically work in professional offices. However, working long hours without overtime pay can be stressful, especially during global pandemics.



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