I’m sure you’re wondering: “What is a Loan Broker?”
What is a Loan Broker?
Loan brokers are professionals who help people obtain mortgages. They work like independent contractors, taking a commission out of the interest rate charged by the lender. Unlike loan officers, loan brokers do not work for any one bank; they work with many different companies to get the best deal for their clients.
A loan broker is a person or business who helps you find the best possible loan. They do this by matching you to the lender with the best rates, terms, and other services tailored to your needs. Lenders have access to more loans than they can give out themselves so it makes sense for them to send borrowers their way.
How to Become a Licensed Loan Broker
To become a licensed loan broker in most states, you need to complete 120 hours of pre-licensure education and apply for an exam. It is important to note that the education requirement varies by state.
There are two ways to become a licensed loan broker. The first way is through an apprenticeship program, which can take about three years. You’ll learn the ropes by getting experience in the industry and studying for another two years at an accredited college or university. The second way involves taking courses that cover the basics of the business-lending process, credit analysis, how to market yourself, and professional ethics. Both paths require certification through state licensing boards.
Tips on Getting Started as a Loan Broker
If you want to get started as a loan broker, there are a few things you should know. The first is that the process of becoming licensed is not difficult. You just need to take an exam and pass it, and then apply for your license. A new broker may also decide on what kind of loan originator they would like to be – retail or wholesale. Lastly, it is important to decide on the type of company that will allow you to work with brokers and agencies that can refer business to you.
If you’re considering becoming a loan broker, one of the first things you’ll need to do is to register as a regulated financial advisor. This will take a few months and you may have to undergo some training and exams before you can become registered. You’ll also need to set up your brokerage business and decide what type of loans you want to specialize in.
Common Interview Questions for an Estimate
What is your three biggest weaknesses?
Describe an instance where you failed on the job.
Who are your top three competitors?
What’s the most common blog template (magazine, newspaper, blog, social media)?
The interviewer may ask you what is your monthly household income. This is to gauge how much money you have to put towards a down payment, which can be 20% of the purchase price for most new homes. They may also ask you how much money you owe on credit cards and other loans, or if you own any investment property that could be used for equity.
John was able to find a job as a loan broker free of charge because he utilized the resources available to him. He didn’t need to take out loans, or spend any money on college courses, so it was worth it for him.
The loan broker industry is a very lucrative field and you can make a lot of money while working from the comfort of your own home. It’s important to know the rules of the game before you start investing in this market, but if you decide to enter it, be prepared for big returns.