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How Loan Officers Make Money? Comp plans, BPS, rate sheets, and salaries? - YouTube

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How do loan officers make money?

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3 ways

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Flat fee

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Basis points

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or salary

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What’s going on guys

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My name is Minh Nguyen

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of What’s A Mortgage!

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Welcome to our channel

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The goal of our channel is to educate

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empower and to inform you on

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what’s a mortgage!

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so ask a lot of questions

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and leave a comment :D

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In todays video

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We’re going to talk about Loan Officer Compensation

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Like I said

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There is 3 ways loan officers, or...

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“Loan Consultants”

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get paid.

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Flat Fee

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Basis Points

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Basis Points aka “Bps”

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or salary

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First, lets talk about “Flat Fee Loan Officers”

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Basically, they’re paid a FLAT FEE

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“PER UNIT”

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“PER UNIT” aka

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“PER UNIT” aka “PER LOAN”

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and sometimes

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these units

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are based on a “Teir System”

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for example

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A loan officer could make

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$400 to $500 per unit

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So, if they close 5 units a month

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They could make up to $2500

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BUT!

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If they fund 10 units or more

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They could move up to the next teir

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and increase it to $600 to $800 a unit!

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But sometimes

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They’ll pay by basis points

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It all depends on where and what company they work for

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Flat fee loan officers

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are very popular among call centers

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But, most call centers

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will decide how they will pay their loan officers

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after they factor in

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cost per lead

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and cost per loan

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Now, lets talk about

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loan officers who get paid by basis points

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AKA “Bps”

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Basis points, is the most popular way

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loan officers and mortgage brokers get paid

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Here is a general break down on basis points

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200 basis points

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is 2%

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100 basis points

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is 1%

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50 basis points

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is half of a percent

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For example

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If a loan officers closes a loan at $400,000

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and they make 200 basis points

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which is 2%

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They make $8000

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If they make 100 basis points

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which is 1%

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they make $4000

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and if they make 50 basis points

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which is half of a percent

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They make $2000

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These loan officers

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Generally generate their own book of business

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they call them

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“Self Gen”

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There are occasions

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when “self gen loan officers” are given leads

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and on those leads

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they get paid a little bit less

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on basis points

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A loan officer, who generates his own book of business

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can make 100 to 250 basis points

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and even some make up to 300 basis points

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Loan officers who work at brick and mortar

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Like; Chase

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Wells Fargo

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Bank of America

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or local credit unions

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could make around 50 basis points

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Usually a self gen loan officer

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will work on a team or region

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that has a set compensation plan

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of 1% or more

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But, if that loan officers

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wants to make more than their team mates

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The company would have to inrease that loan officers rate sheet

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to compensate them

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For example

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If “James” joined “Adams” team

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and Adams team makes, 1%

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but James wants to make 2%

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They would have to make a custom rate sheet

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for James

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to compensate James on his, 2%

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That’s why some loan officers

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will have different rates

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even when they’re on the same team

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and same company

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Now that we understand how loan officers get paid “Bps”

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Lets talk about, mortgage brokers

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Mortgage brokers “broker” their loans

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to different wholesalers

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Like, Quicken

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United Wholesale

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Fairway

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or Homepoint

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They have different compensation plans

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for each wholesaler they work with

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it could range from 1% to 2.75%

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even 3% of the loan amount

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So when they tell you

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they’re gonna shop for the best deal

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what they really mean is

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what lender

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is paying what compensation

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at what rate, for the day

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And that’s how mortgage brokers get compensated

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Last, not not least

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Salary loan officers

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Typically, salary loan officers

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will make between $4000 - $7000 a month

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No matter what loan they sell

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or how many loans they sell

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they get paid a salary

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There is no such thing as a free meal

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If a loan officer makes $7000 a month as a salary

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They are the top of the line

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Grade A loan officer

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and are expected to fund at least 25 units a month!

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Typically you’ll find these loan officers

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working as loan assistance

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for big time loan officers

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credit unions

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or banks

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or for example

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a reddoor.com

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or a better.com

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where loan officers are more

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customer service representatives

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and not sales people

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and thats how loan officers make money

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If you find this video you useful

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Do me a huge favor

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and save this video

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and if you still feel lost

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and you have questions

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