Definition of a Loans Officer
A loans officer is an employee of a lending institution that functions as the liaison between that lender and it’s customers that are applying for a loan.
A basic responsibility of a loan officer is to arrange a bank loan or mortgage that is in the best interests of both the applicant and the bank or the financial institution that they are employed by. The loan officer should possess a comprehensive knowledge of the types of loans that are provided by their particular financial institution and the requirements or conditions that are necessary for applicants to successfully qualify for them. However, in regards to mortgages, loans officers are not required to be licensed or specifically educated in this particular field other than the training provided by their particular employer.
Example
Mr. McGillicuddy obtains a mortgage loan from the bank. The bank designates Mrs. Danforth as the loan officer for the mortgage. All inquiries regarding the loan should be addressed to Mrs. Danforth. The loan officer will make decisions regarding refinancing, extension of terms, prepayment, etc. Though the final decision may not be that of the loan officer, he or she will be the person who is in contact with the borrower.
With the substantial increase in size of many of the banks in Canada, and their division into numerous departments, having a single loan officer to meet with face to face, throughout the duration of a mortgage loan is less and less common. Having a designated a loan officer for the life of a mortgage is far more common in smaller community banks. With larger lenders, borrowers may be directed to one department for refinancing, another department for payment history and another department for payoff information.
Loan Officer vs. Mortgage Broker
A mortgage broker is not a loan officer and is not an employee of a mortgage lender. A mortgage broker has relationships with several lenders and selects the lender and mortgage product that best suits each client’s particular needs.
A loan officer, on the other hand, is only able to offer mortgage products from his or her particular bank, and will not offer products from other lenders.
At First Foundation, we are mortgage brokers rather than loan officers.
The ability to choose from several lenders and their products allows us to customize your mortgage to fit with your personal priorities and financial goals. Some lenders offer lower rates, some offer better pre-payment privileges, some have brick and mortar buildings and some are virtual – each have their advantage and we use our experience and expertise to help you select the best lender and mortgage product for you.
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