Key Takeaways
- Two Main Paths: Loan officers are typically either 1099 independent contractors who keep 100% of the commission or W2 employees who earn a split, often around 90%.
- Fees are Standard: All MLOs pay fees (like admin and processing) that are deducted from their gross commission.
- Channels Matter: The choice between wholesale and correspondent channels can affect commission levels and associated costs.
- Support for New MLOs: Loan Factory offers structured compensation for new officers and an innovative Assisted Loan Officer program for those who prefer a different level of involvement.
- Earnings are Variable: Your final income per loan is influenced by loan size, location, negotiation skills, and the overall health of the housing market.
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If you’re a mortgage loan officer, or thinking about becoming one, there’s a question that’s always top of mind: "How much can I actually make?". This question is the engine behind every loan officer's career. Whether you're just starting out or you're a seasoned pro trying to level up your earnings, the first step to building a powerhouse business is truly understanding how your paycheck works.
Today, we’re going to pull back the curtain and break down exactly how much mortgage loan officers make per loan. We'll demystify the numbers, walk through the different ways you can get paid, and show you why picking the right platform to work with, like Loan Factory, might be the most important decision you make for your income and your future.
→ Read more: What Does a Loan Officer Do? Career Overview & Day-to-Day Duties
How Much Do Mortgage Loan Officers Make Per Loan?
A mortgage loan officer's income isn't a simple salary that hits your bank account every two weeks. It’s a living, breathing number shaped by commission structures, the types of loans you close, and the strategic moves you make. The journey from a loan application to the closing table is full of moving parts, but your income really boils down to your compensation structure.
→ Read more: What is the highest salary for a mortgage loan officer?
Compensation Structures
Mortgage loan officers typically earn through commission-based structures. The two main types are:
- 1099 Independent Contractors: These loan officers are self-employed and keep 100% of the commission from each closed loan, minus certain fees.
- W2 Employees: Employed by a mortgage company, these loan officers usually receive about 90% of the commission, after specific fees.
Fees and Deductions
Since these fees differ among companies, you should expect to encounter several standard fees when starting your career as a mortgage loan officer. Common fees include:
- Admin Fee: Typically $50-$200 upfront to cover application/admin work.
- Monthly Fees: Some companies may charge monthly desk or technology fees, which vary based on the services provided and the loan officer’s employment status.
- Flat Fee: Typically around $595.
- Processing Fee: Usually about $500.
However, make sure to choose the company that offers you the greatest benefits and aligns with your career goals. For example, at Loan Factory, there are no fixed monthly fees - only a flat admin fee of $595 and a processing fee of $500 per loan, which can help maximize your take-home pay.
Wholesale vs. Correspondent Channels
Loan officers can process loans through 2 main channels:
- Wholesale Channel: Offers higher commissions but requires adherence to lender compensation rules. Loan officers can choose between lender-paid or borrower-paid compensation.
- Correspondent Channel: Similar pricing to the Wholesale channel, but additional fees like VOE, Credit Refresh, Funding Fee, and MERS fee may apply. Admin fees can increase to $895 to cover these costs.
New and Inexperienced Loan Officers
New loan officers may have different initial compensation structures. At Loan Factory, for instance, they earn 80% of the broker's compensation on their first three transactions, after deducting $595 admin and $500 processing fees.
→ Read more: How to become a mortgage loan officer with no experience
Factors Influencing Earnings
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Several factors affect a mortgage loan officer’s earnings per loan:
- Loan Amount: Larger loans generally yield higher commissions.
- State Regulations: Compensation structures and fees can vary by state.
- Negotiation Skills: Better negotiation can result in higher commissions.
- Market Conditions: Loan demand and market competitiveness influence earnings.
→ Read more: How to Become a Mortgage Loan Originator Fast & Earn More
Why Choosing Loan Factory Can Elevate Your Income as a Mortgage Loan Officer
A mortgage loan officer’s earnings per loan can vary based on their compensation structure, loan type, and associated fees. Understanding these factors helps aspiring loan officers set realistic expectations and make informed career decisions. Whether you’re new to the field or an experienced professional, knowing how compensation is calculated is crucial for financial planning and career success. We’ve built a digital mortgage platform designed to tackle the exact pain points that hold loan officers back elsewhere.
At Loan Factory, we give you the ALL-IN-ONE mortgage platform, the structure, and the freedom to build the career you actually want, on your own terms.
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→ Want to see what others say? Read our reviews!
Ready to take control of your career and financial future? Visit www.loanfactory.com/loan-officer or call 714-591-8143 today to learn more about joining our team of top-tier mortgage professionals.
FAQs
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1. How is a loan officer commission typically calculated?
It's usually a percentage of the loan amount, measured in Basis Points (BPS). For instance, 100 BPS equals 1% of the loan. Your take-home pay is that gross amount minus any split you have with your company and standard fees (admin, processing, etc.).
2. Is it better to be a 1099 or W2 loan officer?
That really depends on you. If you want maximum earning potential and are comfortable managing your own business, 1099 is the way to go. If you prefer more stability and benefits, being a W2 employee with a commission split might be a better fit.
3. What are the average earnings for a new loan officer at Loan Factory?
While everyone's journey is different, we jumpstart our new LOs by giving them 80% of the broker's compensation on their first three deals. When you combine that with our training and support, you’ll find that our new officers tend to build momentum and earn significant income faster than the industry average.
4. How can I increase my earnings as a mortgage loan officer?
Focus on the fundamentals: build your network to increase loan volume, find a niche market you can dominate (like FHA or VA loans), sharpen your negotiation skills, and—most importantly—partner with a company like Loan Factory that offers competitive pay and real support.
5. What market factors will affect my income in 2025?
Looking ahead to 2025, keep an eye on interest rate fluctuations, high home prices, and shifting buyer behavior. A wave of Gen Z buyers is entering the market, creating a massive opportunity for loan officers who can connect with and educate this new generation of homeowners.
Disclaimer: The information provided in this blog post is for informational purposes only and does not constitute financial or legal advice. Compensation structures and fees can vary and are subject to change. Please consult with a professional for advice tailored to your specific situation.
