ByAspiring mortgage loan originators often wonder about the earning potential in this profession. The salary of a mortgage loan originator, also known as a loan officer, can vary based on several factors such as experience, location, and the type of institution they work for. In this comprehensive guide, we will explore the average mortgage loan originator salary, factors that influence earnings, and the job growth trend in this industry.
Job Description and Education Requirements
Mortgage loan originators play a crucial role in the lending process. They are responsible for evaluating mortgage applications, investigating the information provided, and making decisions about issuing mortgages to consumers. These professionals typically have a background in banking and business finance, with a strong understanding of business accounting and finance. While a bachelor’s degree is often preferred, individuals without a four-year degree may still be able to become loan officers if they have relevant work experience in banking, customer service, or sales.
Licensing and Compensation
To practice as a mortgage loan originator, individuals must obtain a license, which involves completing 20 hours of coursework, passing a licensing exam, and undergoing a criminal background check. Compensation for mortgage loan originators can vary and is often based on commission, salary, or a combination of both. According to the U.S. Bureau of Labor Statistics (BLS), the median average salary for mortgage loan originators was $64,660 as of May 2017. However, it’s important to note that earnings can vary significantly based on experience, location, and the institution they work for.
Average Salary by State
The average salary of a mortgage loan originator can vary depending on the state in which they practice. Factors such as the cost of living and the demand for loan officers in a particular area can influence compensation. According to the BLS data, the average MLO salary ranged from $30,690 in Puerto Rico to $80,600 in New York. States like California, Maryland, and Massachusetts also offered higher average salaries for mortgage loan originators. It’s essential for loan officers to consider the regional differences in compensation when evaluating potential career opportunities.
| State | Average MLO Salary (USD) |
|---|---|
| Alabama | $57,110 |
| Alaska | $61,270 |
| Arizona | $53,270 |
| Arkansas | $63,170 |
| California | $63,600 |
| Colorado | $62,390 |
| Connecticut | $61,400 |
| District of Columbia | $75,700 |
| Delaware | $67,340 |
| Florida | $62,330 |
| Georgia | $63,000 |
| Guam | $44,880 |
| Hawaii | $70,600 |
| Idaho | $53,820 |
| Illinois | $63,562 |
| Indiana | $58,470 |
| Iowa | $66,860 |
| Kansas | $65,430 |
| Kentucky | $58,620 |
| Louisiana | $51,260 |
| Maine | $61,590 |
| Maryland | $74,710 |
| Massachusetts | $66,060 |
| Michigan | $69,380 |
| Minnesota | $73,980 |
| Mississippi | $50,200 |
| Missouri | $71,230 |
| Montana | $62,930 |
| Nebraska | $67,940 |
| Nevada | $52,200 |
| New Hampshire | $74,470 |
| New Jersey | $69,000 |
| New Mexico | $52,180 |
| New York | $80,600 |
| North Carolina | $68,330 |
| North Dakota | $73,570 |
| Ohio | $66,130 |
| Oklahoma | $66,390 |
| Oregon | $69,920 |
| Pennsylvania | $68,800 |
| Puerto Rico | $30,690 |
| Rhode Island | $69,380 |
| South Carolina | $63,870 |
| South Dakota | $67,280 |
| Tennessee | $53,850 |
| Texas | $69,010 |
| Utah | $41,420 |
| Vermont | $58,530 |
| Virginia | $60,460 |
| Washington | $63,430 |
| West Virginia | $49,770 |
| Wisconsin | $62,800 |
| Wyoming | $66,790 |
Note: The figures mentioned above are based on the U.S. Bureau of Labor Statistics data and may vary based on experience and the mortgage company.
Impact of Experience on Salary
Experience plays a significant role in determining the salary of a mortgage loan originator. As loan officers gain more years of experience, they tend to earn higher incomes. According to a survey by PayScale.com, the correlation between years on the job and compensation is as follows:
- 0-5 years: $40,000
- 5-10 years: $70,000
- 10-20 years: $81,000
- 20+ years: $51,000
This data indicates that mortgage loan originators can expect to earn more as they gain job experience. However, it’s worth noting that many loan officers eventually transition to other careers after a certain period.
Job Growth Trend
The job growth outlook for mortgage loan originators appears promising. The BLS projects an 11 percent growth in employment opportunities for loan officers from 2016 to 2026. This growth can be attributed to expected economic expansion, which will likely stimulate real estate sales. However, it’s important to consider potential challenges in the industry, such as the decline in the number of bank branches, where many loan officers work. Despite these challenges, the overall job growth trend for mortgage loan originators remains positive.
Conclusion
Becoming a mortgage loan originator can be a rewarding career choice with the potential for a lucrative income. While earnings can vary based on factors such as experience, location, and the institution you work for, the average salary for mortgage loan originators is substantial. As the real estate market continues to evolve, there are ample opportunities for loan officers across different states. By gaining experience, obtaining relevant certifications, and staying updated on industry trends, mortgage loan originators can enhance their earning potential and build a successful career in this field.
