One of the first questions people ask when learning about the mortgage industry is:
“How much does a loan officer make on a mortgage?”
The honest answer is: There is no fixed amount per loan.
A loan officer’s income on each mortgage depends on:
- The loan amount
- The commission structure
- Whether the business is self-generated or company-generated
- Fees, splits, and possible chargebacks
Let’s break this down step by step, using realistic U.S. examples.
First, How Loan Officers Get Paid
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In the U.S., most loan officers:
- X Do NOT earn a salary per loan
- X Do NOT get paid hourly
- ✔ Get paid commission, only when a loan closes and funds
Simple rule:
No closing = no commission
This applies to both:
- W2 loan officers
- 1099 loan officers
→ Read more: 1099 vs W2 Mortgage Loan Officer Pay | Key Differences Explained
What Does “Commission on a Mortgage” Mean?
When a mortgage closes:
- The lender pays the brokerage
- The brokerage pays the loan officer
- Payment happens after closing, funding, and compliance review
The commission is usually based on a percentage of the loan amount, often discussed in basis points (bps).
100 basis points (bps) = 1% of the loan amount
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Real Example #1: Typical Purchase Loan in the U.S.
Scenario (Educational Example):
- Home purchase price: $500,000
- Loan amount: $400,000
- Loan officer compensation: 1% (100 bps)
Step-by-step:
- 1% of $400,000 = $4,000 gross commission
- Brokerage fees apply
- Net commission is paid to the loan officer
Key point: This is gross commission, not take-home pay.
Real Example #2: Smaller Loan vs Larger Loan
Smaller Loan
- Loan amount: $250,000
- 1% commission = $2,500 gross
Larger Loan
- Loan amount: $800,000
- 1% commission = $8,000 gross
Bigger loans usually mean higher gross commission, but they often involve:
- More documentation
- More underwriting conditions
- Longer timelines
→ Read more: How much do mortgage loan officers make per loan?
.jpg "How much does a Loan Officer make on a mortgage?")
Self-Generated vs Company-Generated Loans (Big Difference)
- Self-Generated Loan (Common for Experienced LOs)
Example:
- You get a referral from a real estate agent
- Loan closes
- You keep a larger portion of the commission
→ Higher net income per loan
- Company-Generated Lead
Example:
- Company gives you an online lead
- Commission split is disclosed upfront
- Loan closes
→ Lower commission per loan, but:
- Less time spent finding the client
- Useful for newer loan officers
Neither is “better”—they serve different stages.
Example #3: After Fees (What LO Actually Takes Home)
Let’s continue with the $400,000 loan example.
Gross commission: $4,000
Possible deductions (illustrative):
- Processing fee
- Administrative fee
- Split (if applicable)
→ Net pay is less than $4,000
This is why loan officers should always ask:
“Is this gross or net commission?”
Important: Early Payoff (EPO) Example
What is EPO?
If a borrower refinances or sells the home too soon, the lender may charge back the commission.
Example:
- Loan closes
- LO gets paid
- Borrower refinances 3 months later
- Lender charges back the brokerage
→ LO may have commission offset or recovered
This is normal in the U.S. mortgage industry, not a penalty.
Do All Loans Pay the Same?
No.
Some loans:
- Take 20–30 days
- Close smoothly
Others:
- Take months
- Fall apart late
Loan officers do not control everything—borrower behavior and underwriting matter.
Why “Per Loan Income” Can Be Misleading
New loan officers often focus on:
“How much do I make on ONE loan?”
Experienced loan officers focus on:
- How many loans close per month
- How consistent closings are
- How many deals fall out
→ Consistency beats one big deal.
Realistic Monthly View
Example:
- 2 loans close in a month
- Each generates ~$3,000 gross commission
→ Gross production ≈ $6,000 for the month
Some months:
- More loans
- Some months: fewer or none
This variability is normal.
Why Choose Loan Factory as a Loan Officer
Loan Factory is designed to support loan officers with clear compensation and transparent structure.
What Loan Factory Offers:
- Both W2 and 1099 models
- Clear commission on closed and funded loans
- 100% commission on eligible self-generated loans, minus a flat $595 fee
- No desk fees or junk fees
- Free MOSO platform (CRM, LOS, pricing, compliance tools)
- Access to 240+ wholesale lenders
- In-house underwriting support and $500 processing per file
- Company-generated leads (with disclosed splits)
- Mentorship from Thuan Nguyen (#1 Loan Officer in the U.S.)
- Weekly training and Loan Factory Academy
- Best Price Guarantee to help compete for borrowers
(Terms & Conditions apply)
Compensation is paid only on closed and funded loans and may be subject to early payoff and compliance review.
Final Answer
How much does a loan officer make on a mortgage?
→ It depends on:
- Loan amount
- Commission structure
- Fees and splits
- Whether the loan closes
- Whether the loan pays off early
There is no fixed number per loan.
Next Step
If you’re new and trying to understand how loan officer pay works before jumping in:
→ Join the Loan Factory webinar:
https://www.loanfactory.com/loan-officer
Or call us at 714-591-8143
Disclaimer
This article is for informational purposes only and does not guarantee income or employment.
Loan officer earnings depend on individual performance, market conditions, compliance requirements, and lender policies.
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