how a loan officer works
the loan officer is the direct contact for most borrowers applying for a loan from a financial institution the entire process can be handled over the internet but most consumers probably still prefer a well informed human on the other side of a costly and complex transaction in fact one reason why banks continue to have so many branch offices is that they need to bring loan officers face to face with potential borrowers loan officers are knowledgeable about all of the various types of loans offered by the financial institutions they represent and can advise borrowers on the best options for their needs they also can advise the potential borrower about what type of loan they might be eligible to get the loan officer is responsible for the initial screening process and is unlikely to proceed with an application from someone who does not meet the lender s qualifications once a borrower and a loan officer agree to proceed the loan officer helps prepare the application the loan officer then passes the application along to the institution s underwriter who assesses the creditworthiness of the potential borrower if the loan is approved the loan officer is responsible for preparing the appropriate documentation and the loan closing documents the loan officer is responsible for collecting the appropriate closing documents for a mortgage or other loan some loans are more work than others secured loans generally require more documentation than unsecured loans mortgage loans require a hefty stack of documentation due to the many federal state and local regulations that pertain to them reverse mortgages and mortgage refinancings require that the borrower receive a hud 1 settlement statement before the closing 3some loan officers are compensated through commissions this commission is a prepaid charge and is often negotiable commission fees are usually highest for mortgage loans can i obtain a loan without a loan officer even in a world of online lenders loan officers are necessary parts of the process loan officers evaluate whether borrowers are trustworthy enough to handle a loan even online bank utilize loan officers to complete transactions 