Mortgage bankers are employees of financial institutions who assist borrowers in finding the loan they need. They originate loans and service them until they’re paid off or sold on the secondary market, if necessary. Their job entails making sure the loan meets all employer requirements while keeping it safe and secure for its intended beneficiary.
Fee-earners earn fees through the underwriting, approval and closure processes associated with mortgage loans. This involves assessing a borrower’s income, assets and debt; providing them with loan estimates as well as details of the mortgage agreement.
Mortgage bankers have the knowledge and skill set to assist borrowers from any financial background, even those who may not meet other lending criteria. For instance, they may approve borrowers even if they are self-employed or have an unusually high debt-to-income ratio (DTI).
Furthermore, lenders can assist borrowers who desire to purchase homes but cannot afford them by providing them with options for improving their financial situation and reducing the cost of their loan. For instance, they may suggest financial counseling services which help borrowers reduce debt obligations and boost their credit score.
As a mortgage banker, you need a degree in finance or another closely related field. Furthermore, having extensive professional networks is beneficial; these may include real estate agents, clients and business professionals with specific needs related to real estate and finance.
Transitioning from broker to mortgage banker necessitates extensive planning and effort. It takes time to hire staff, build relationships with warehouse lenders, and meet capital requirements.
Some individuals who aspire to become mortgage bankers do so in order to have more control over the funding process of loans and the opportunity to work directly with borrowers. Although this requires extra effort, the rewards can be great.
As a mortgage banker, you will need a bachelor’s degree in either finance or accounting. Alternatively, you could pursue graduate-level study of some sort related to business administration that relates closely to finance.
Mortgage bankers usually work at a single financial institution or another large institution, though some specialize in smaller banks or different loan types. It is essential that they become familiar with all types of mortgages offered by these institutions – fixed-rate, adjustable-rate and home equity lines of credit included – before offering their services.
They must be conversant with the laws and regulations governing their industry, as well as those for mortgage brokers. Furthermore, they need to comprehend the underwriting process and guarantee they adhere to federal requirements like the Home Mortgage Disclosure Act, Fair Lending Policies and Anti Money Laundering laws.
Many banks and mortgage lenders have compliance departments that enforce these rules. They must also have comprehensive policies and procedures for underwriting and closing a mortgage, as well as an employee liaison who communicates these directives to employees.