Greetings BP family,
I recently passed my SAFE Act exam and am ready to begin building my book of business as a mortgage loan officer / originator in Virginia!
My question for experienced MLO's out there is, what are some tips you'd give to a new MLO looking to build business?
Of course, I'm going to call my warm market, brings donuts to RE officers, and attend local business functions, but what are some other things I can do to start filling that pipepline?
Thanks in advance!
@Chris Mason is a MLO so he could probably speak to this.
I think a lot of what you could do though is similar to what I do as an agent. Talk to anyone and everyone you know, and/or meet about real estate. I mean everyone. I helped the cashier at a 7/11 buy a house because I know that how much money I make is proportional to how many people I talk to about real estate.
Hi @Ryan Davis ,
I started, fresh out of college, as an assistant to a seasoned LO, with 20 years under his belt. He qualified the people, sold, originated, structured the deals, and I'd collect the paperwork needed to close them out, progressively solving bigger and bigger hiccups without the LO's help or input.
Eventually I noticed out that, three months or a six months closing, it wasn't my boss that younger millenials were referring their friends/family/etc to... it was me. So there were a bunch in his name, where I did everything start to finish. "Wait, it says on this closing paperwork that Fred is our LO... who the heck is Fred?" was always a fun conversation from those days (note that this is only lawful if you are actually licensed and formally affiliate that license with the firm you work at, which requires approval from your employer).
And then I noticed several REI pick-me-up deals (a 'pick me up' deal is where a big bank can't figure it out, and it falls in your lap two weeks into escrow, with two weeks until scheduled close of escrow) where I figured it out when my LO couldn't and/or without his input. You will quickly learn that most MLOs suck at REI mortgage math (hell, just read this website), hence all the fumbled pick-me-up deals. And then it was the same thing, those REI didn't call my boss back for the next one... they called me back.
OK, so there's millenial first time home-buyers, and REI. That became my dual niche.
If you want to copy that sort of model, go be someone's assistant for a while, with a base wage that'll keep you from starving. Let your niche come to you. You really have no idea what it will end up being. You're on this website so you may think it will be REI, but maybe what you are truly a wizard at is playing financial marriage counselor for newlyweds, and then you will start getting all the newlywed business. Who knows.
Thank you for the response, @Chris Mason !
Thanks, @Russell Brazil !
@Chris Mason , too bad I already voted for president...
@Mindy Jensen I just passed my UST and MN SAFE exams as well. Will be starting as a MLO in MN here shortly. How have the first couple months been going for you? Any helpful tips that have brought you in new business?
Ryan and others -- I got a question. I've been considering preparing for and getting the MLO license for couple of states. What I am unsure about are the following and need answers:
1) Does an MLO need to be employed by a lender or mortgage bank? Or can they operate independently sourcing lending offers from various lenders on behalf of buyers?
2) Can an MLO operate in multiple states after passing those state-specific tests?
Thanks in advance!
Hi @Ramesh Anthony ,
1) In practice, it is not presently economical to be a small-sized independent mortgage brokerage. The current regulatory regime really screws over the little guys. Those small teams are still out there, many with DBA paperwork to continue branding themselves as "ABC Small Time Local Mortgage Brokerage" that's been around for 30 years that everyone knows, but really behind the scenes they are all employees of "XYZ Lending" along with 5,000 other employees. Typically the "owner" of the "firm," on paper, is simply a Loan Officer or Branch Manager, and all "his" employees are actually Loan Officer Assistants with pay-stubs that say "XYZ Lending" on them. But if you walk in, everyone introduces themselves as mortgage brokers and it doesn't say "XYZ Lending" on the wall, it says "ABC Small Time Local Mortgage Brokerage."
2) Yes, with certain restrictions/requirements, some of which vary by state.
Even if it isn't as economical as the days prior to dodd frank, can an MLO operate independently without being tied to a mortgage bank or lender? I read the requirements of a number of states (CA, TX, FL, NJ, etc) and read that an MLO requires sponsorship. My guess is it means employment or some sort of official tie up.
ALso in your profile it says you're a lender. Are you in the residential mortgage lending business?
Hi @Ramesh Anthony ,
So point of clarity. Yes, you have to hang your license with an institution because it pragmatically isn't economical to run your own independent shop these days.
You're still often brokering or correspondent lending, though, if you work for a mortgage bank or mortgage company (eg, not a "bank" bank, where you can have a checking account). You can clearly see what company I "work" for as a residential mortgage lender, but they aren't the end-lenders that get all of my business (far from it), and it's not any sort of secret.
Once your production reaches a certain level, or that of you and a few like-minded peers does, it can still be perfectly viable to run your own branch. There's a half-dozen of us (MLOs and operations folks) that do our own thing. When we decide to switch companies (we just did this), we formally evict our "employer" from the building on the same Friday we quit, and the branch remains physically in place with new signage up, new phones, new computers, lease signed with new employer, et cetera, on Monday.
Very helpful. Thank you!
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