A mortgage broker is a financial expert who helps home buyers and homeowners with financing options for real estate transactions. Some mortgage brokers may work for financial solutions companies but many others are self-employed but they work independently of banks or other financial institutions.
Mortgage brokers work independently of loan companies to offer home buyers and homeowners mortgage financing options from multiple lenders. Most hold bachelor's degrees in a relevant field. State and federal laws regulate mortgage brokers, who must be licensed in many states and can earn voluntary professional certifications. Their pay is generally from commissions based on the loans they have arranged.
|Required Education||Typically a bachelor's degree in finance or relevant field|
|Other Requirements||Many states require licensing|
|Projected Job Growth (2014-2024)||8% (all loan officers)*|
|Median Salary (2016)||$51,856**|
Source: *U.S. Bureau of Labor Statistics (BLS), **PayScale.com
Mortgage Brokers' Job Duties
A mortgage broker serves as a financial expert, retained by a homeowner or homebuyer to explore financing options for real estate purchases or refinancing, and to take care of the loan origination process up to the point of disbursing the funds. Armed with credit and financial information from the potential borrower, a mortgage broker uses a network of lenders and institutions to find a loan that suits the needs and desires of the buyer, then negotiates with the lender to secure terms and options for the buyer. When the application is approved, the mortgage broker oversees the signing of the loan documents.
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Career Information for Mortgage Brokers
Unlike loan officers, mortgage brokers are not employed by the bank or financial institution that ultimately lends the money. They may work for financial solutions companies which do not themselves issue loans, or they might choose self-employment as an independent contractor or owner of their own brokerage. Self-employed individuals may choose their own hours of operation and work from home.
Much of the compensation for mortgage brokers comes in the form of commissions and fees based on the number and dollar value of the individual deals that brokers facilitate, leading to an exceptionally broad potential income range. According to PayScale.com, most mortgage brokers earned between $26,074 and $183,170 as of January 2016. The median salary for these professionals was $51,856.
Mortgage Broker Licensing and Certification
Most states require licensure of mortgage brokers, and each state determines licensing requirements. For example, in California, holding a real estate broker license qualifies an individual to be a mortgage broker, but in Alabama and most other states that require licensure, a separate mortgage broker license must be obtained. In states that license mortgage brokers, the brokers are held responsible for any fraudulent actions they may take while securing and closing a loan for a buyer.
The National Association of Mortgage Brokers offers three levels of voluntary certification. The entry-level General Mortgage Associate certification requires an examination. Certification as a Certified Residential Mortgage Specialist or Certified Mortgage Consultant requires several years of experience and professional education.
Along with possessing a bachelor's degree, ideally, mortgage brokers also possess excellent mathematics skills, are up to date on economic and marketing trends, have a thorough understanding of mortgaging practices, and possess great communication and organizational skills.