Becoming a Mortgage Loan Officer: Why Finance is Important

Apr 21, 2016 by

It takes a lot of qualifications in order to land a great job. You need the right education, some relevant experience, good recommendations, and the right personality. Of those, the education is the one that’s hardest to reverse. You can always gain more experience, generate better recommendations, and improve your personality.

But it is time-consuming, expensive, and complicated to return for more education after you complete a course of study. For that reason, it’s very important to get the right classes the first time around, or at least to be very efficient in what you choose to study when returning to college.

Many people start a new job and soon realize that much of what they studied in college isn’t all that helpful. Some have taken college work in high school only to find out it didn’t really make a difference in their work. If you are interested in becoming a mortgage loan officer, you may have talked to others in the field who have advised you against certain classes.

And while it is true that classes like Early Spanish History or Sharks Of The Philippines won’t serve you very well as you serve your clients, the fact is that a good grounding in finance is critical to your success, even though the day-to-day work may not seem to require much more than a rudimentary understanding.

Eagle Home Mortgage is successful because they guide their clients in the right direction. The 2008 mortgage crisis was driven largely by the actions of uninformed lenders and borrowers, neither of which could see the potential crash in the near future.

Instead, mortgages were too large for home values, interest rates were ready to soar, and the sale of mortgages created a nearly-unintelligible quagmire of ownership. Only the best lenders steered their clients clear of the brewing trouble.

The best way to look at the situation is to consider a mortgage loan officer to be part lender and part financial adviser. The person who serves in this role has a unique obligation to both the borrower and the lender.

If a borrower is not a good loan candidate, the officer should say so by declining the application. This can be an unpleasant process, but it’s far more pleasant than allowing a bad loan to go through. When this happens, everyone loses. The borrower loses the home and sees his or her credit rating damaged. The lender ends up with a bad debt and a foreclosed house that can’t necessarily be sold.

It’s clear that an officer who takes a risk on a shaky potential client isn’t doing anyone any favors. What isn’t always clear is what makes a strong client, and what makes a weak one.

This is where the officer’s education comes in. Almost anyone can check a credit score, complete the appropriate forms, and get a mortgage going. What separates the true loan officers from an ordinary paperwork shuffler is an understanding of the overall economy.

Good officers see the clouds boiling up as a financial storm gathers. They understand the potential for interest rate changes, housing market adjustments, and employment changes. They can assimilate this knowledge into a more complete advice package to the applicant, and help him or her assemble an arrangement that will prove sustainable while still maximizing its financial quality.

It takes an officer who is not only a caring financial advisor but is also an astute observer of the overall economy. That’s the surest way to do right by borrowers, lenders, and the entire financial system.

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