Loan Officers: Salary Overview
Loan officers assess if a loan applicant qualifies to receive a loan and recommend or authorize applications for people and businesses.
A loan officer’s responsibilities include contacting companies or people to see if they need a loan, meeting with loan applicants to gather relevant information, explaining different types of loans, obtaining and analyzing the applicant’s financial information, reviewing loan agreements, and approving loan applications.
According to the Bureau of Labor Statistics, the median annual wage for loan officers was $63,270 as of May 2019.
This means that half the workers in this occupation earned less than this amount and half earned more.
Salaries vary based on a wide range of factors, including the employer, the loan officer’s experience and education, and the region of employment.
The best-paid 10 percent of loan officers earned more than $132,680 per year while the lowest 10 percent made less than $32,560.
Loan Officer Salary by Industry
According to the United States Bureau of Labor Statistics, loan officers held about 316,200 jobs in 2018, 81 percent of them being employed in the field of credit intermediation and related activities.
About 5 percent of loan officers worked for companies that provide management of companies and enterprises and 4 percent were employed by automobile dealers.
The credit intermediation and related activities field include establishments that lend funds raised from depositors or from credit market borrowing.
Businesses in this sector engage in activities such as mortgage and loan brokerage, reserve, and check cashing services.
Loan officers’ salaries vary depending upon the industry of employment.
The biggest employer for loan officers, the industry of credit intermediation and related activities, offered them an average annual salary of $75,070.
The mean annual salary reported by loan officers who worked for companies that provide nondepository credit intermediation was $74,420.
The non-depository credit intermediation field includes public and private enterprises that extend credit or lend funds raised by credit market borrowing or by borrowing from other financial intermediaries.
Loan officers hired in the field of management of companies and enterprises earned $79,620 a year, on average, while those who worked for automobile dealers earned an average annual salary of $95,630 a year- higher than the average for this profession.
According to the Bureau of Labor Statistics, the federal executive branch hired about 3,810 loan officers and paid them, on average, with $74,760 per year.
Higher average annual salaries were reported in the sector of securities, commodity contracts, and other financial investment and related activities, a field that hired approximately 3,530 loan officers and paid them, on average, with $110,530 per year.
Salaries for loan officers are also influenced by their level of education, experience, and the region of employment.
Holding a bachelor’s degree in the field and having a few years of on-the-job training may improve your earning prospects.
Mortgage loan officers will need and Mortgage Loan Originator license which can be earned after completing at least 20 hours of coursework and passing an exam and a background check.
American Bankers Association, the Mortgage Bankers Association, and several schools offer courses for loan officers.
Commissions and Total Compensation
A loan officer’s compensation package depends upon the employer.
Some earn a flat salary while others earn a base salary plus commission on each loan.
Commissions can greatly increase the total cash compensation for loan officers and those who have good skills can supplement their earnings by several tens of thousands of dollars a year.
The percentage can vary depending upon a variety of factors, and for new customers, the commission may be higher than for existing customers.
For example, if the loan officer receives 1% of every loan this means that for a $100,000 loan, she/he gets $1,000 in commission.
Other loan officers may receive a fixed payment for every loan they make.
Regardless of how the commission is calculated, the loan officer’s total compensation is dependent upon his/her knowledge and skills.
* Based on information from the May 2021 salary report from the BLS. The figures represent accumulated data for all states of employment for Loan Officers. BLS data represents averages and medians for workers at all levels of education and experience. This data doesn't represent starting salaries.
* Employment conditions in your area may vary.