For years, many in the mortgage industry have used the terms “mortgage originator” and “loan officer” interchangeably. Today however, a new trend is emerging and the two monikers are developing into their own unique, individual roles. To understand this changing dynamic, and what their jobs will look like in the future, we’re going to dissect the two and see where the differences lie.
While technology has helped simplify management of the more tedious processes of mortgage origination, sales and borrower engagement, there remains a great deal of information for lenders to keep up with. From creative marketing strategies to new regulations and products, it is here where loan originators tend to shine. Rather than engaging with borrowers on the minute details of their loans, loan originators tend to focus instead on their overall book of business and the “big picture” strategies for clients. I occasionally also refer to them as loan planners or mortgage consultants.
On the flip side, loan officerstend to be more adept at driving business through their branch or office. For these professionals, stress tends to build as they gather together a large book of business, but then have to back-up their sales with high-level research and study. Their preference is often to work directly with their borrowers on an individualized basis and help them identify the best loan for their own unique financial situations. These professionals are also tend to have a background in processing or underwriting, which typically means they are highly attentive to small details and nuances of specific loan structures.
That’s not to say one is better than the other, or more necessary to a productive mortgage business. In fact, the most successful lenders have the two tracks running parallel with each other and functioning akin to a pilot and co-pilot, or even a counsel and co-counsel in legal fields.
This changing dynamic is important as it puts the borrower first by creating a synergy between the loan originator and loan officer, with both playing to each other’s strengths. Frankly, I see the loan originator as representing the first steps of a borrower’s journey, helping him or her identify possible strategies for their mortgage, building trust and offering general guidance on issues like credit scores, for example. Once this framework strategy is in place, borrowers can seamlessly shift to working with loan officers who can help them with the minute details and identify their personal pathway to debt-free homeownership.
Taking a more in-depth look, one can see that it’s the originator who lays out the ‘big picture’ or 30,000 foot view for the borrower, and helps them narrow their focus to one or a few select options. Then, the loan officer helps them narrow that view even further to create a smarter mortgage plan that allows them to ultimately save money and build personal wealth. This works to the advantage of borrowers as they have access to not one, but two experts in the mortgage industry, each with their own specialization to help them identify the best possible loan.
This trend will continue to develop as technology impacts how lenders do business with borrowers, particularly as data, machine learning and AI come to play as an integral part in the lending process. Using data, lenders are able to identify and interact intelligently with borrowers at the start of their decision making process, establishing trust prior to them even starting the mortgage process. When the borrower does decide to move forward with originating a loan, lenders will be better prepared to provide them the best quality advice regarding the loan options available. While the role of originator and officer may be diverging in some respects, when a borrower is deciding where to take their business, they do not look for individual titles or positions. Rather, they look for businesses that respect their financial position, care about their future and work with honesty and character. That’s why this changing dynamic is important, not because of job titles, but because it will offer lenders more opportunities to demonstrate their expertise, educate borrowers and guide them down a homeownership path that supports their long-term financial wellness.
About The Author
Mike Hardy is Regional Manager of Southern California for Churchill Mortgage, a full-service and financially sound leader in the mortgage industry. The company provides conventional, FHA, VA and USDA residential mortgages across 46 states. For more information, visit churchillmortgage.com or follow the company on Twitter, @ChurchillMtg, or LinkedIn at https://www.linkedin.com/company/churchill-mortgage.