How Much Does a Mortgage Broker Make?

By Indeed Editorial Team

Updated February 22, 2021 | Published February 25, 2020

Updated February 22, 2021

Published February 25, 2020

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Working as a mortgage broker can offer rewarding career opportunities in the financial industry. Depending on your location and experience level, you could make a satisfying salary as a mortgage broker, which is earned by commission. Mortgage brokers assist people with securing and closing mortgages or home loans. They work as liaisons between borrowers and lenders and work closely with loan officers, underwriters, title companies and real estate agents.

In this article, we discuss how much mortgage brokers make and how you can become one.

Related: Your Guide to Careers in Finance

How much do mortgage brokers make?

Mortgage brokers earn an average of $92,262 per year in the United States, but this figure can vary based on factors such as experience level and geographic location.

Mortgage brokers make money differently than many other professionals do. Instead of earning a standard salary, most mortgage brokers get a commission every time they complete a loan transaction, according to the following factors:

The commission that they earn from a mortgage depends on the terms of the loan

On average, mortgage brokers charge a commission of 2.25% for each loan, but per federal regulations, they cannot charge more than 3% of the loan amount.

Broker fees depend on the agreement they have with their client

Brokers can work on behalf of either borrowers or lenders, so their fees depend on the agreement with their clients. Lenders generally pay a higher commission than borrowers do. When lenders compensate mortgage brokers, they typically pay between 0.5% and 2.75% of the total amount of the loan. When borrowers pay the commission, mortgage brokers usually charge an origination fee that equals less than 3% of the loan amount.

Commission rates influenced by the housing market

In many cases, mortgage brokers decide their commission rates based on the housing market in their area.
For example, those who work in a more competitive housing market may need to charge lower commission rates, so they can position themselves as a better and more affordable choice than other mortgage brokers.

Related: 16 Accounting Jobs That Pay Well

What do mortgage brokers do?

The role of mortgage broker involves helping people secure and close mortgages or home loans, which includes the following responsibilities:

  • Researching loan options, monitoring new mortgage offerings and finding products and rates that meet their clients' needs. They often have to negotiate rates and terms with lenders and confirm loan details with underwriters. Mortgage brokers also access clients' credit reports, verify their reported income and expenses, and coordinate loan details and paperwork with clients and real estate agents.

  • Although mortgage brokers can work independently, many work for mortgage broker firms. As they gain experience, they develop relationships with lenders and create mortgage packages to offer borrowers. Most experienced mortgage brokers establish set compensation rates for each lender.

  • Because mortgage brokers work in the highly regulated financial industry, they must be licensed. Whether they are self-employed or work for a firm, these professionals are responsible for keeping their license current as long as they're working.

  • Mortgage brokers also have to maintain strong networks so they continue to receive business and get new clients. Most have relationships with real estate agents, who may refer them to new clients seeking home loans.

Related: Learn About Being a Loan Officer

How do you become a mortgage broker?

Employers typically expect mortgage brokers to have a bachelor's degree, a current license and on-the-job training.

To become a mortgage broker, follow these steps:

  1. Earn a bachelor's degree.

  2. Take a pre-licensure class.

  3. Pass the licensing exam.

  4. Customize your resume.

  5. Complete on-the-job training.

  6. Cultivate important skills.

  7. Build a strong network.

1. Earn a bachelor's degree

First, complete an undergraduate program at an accredited university. Consider choosing a course of study that teaches you the fundamentals needed as a mortgage broker, such as finance, economics or accounting. Pursuing a major like business or real estate can also help you master the basics of this industry.

2. Take a pre-licensure class

Next, enroll in the pre-licensure program that all aspiring mortgage brokers must complete before looking for a job. This standard program includes 20 hours of classroom instruction that covers topics like mortgage origination, ethical issues for mortgage brokers and federal and state regulations. The National Mortgage Licensure System oversees pre-licensure programs for mortgage brokers.

3. Pass the licensing exam

After completing the pre-licensure program, take the licensing exam, which is administered by the National Mortgage Licensure System. The exam is available at any time throughout the year and includes questions for national and state test-takers. You need a passing score on the exam and successful background and credit checks to earn your Mortgage Loan Originator license. Check with your state's licensing board to find out if you have to meet any additional requirements to work in your area.

Since you must have a current license to work as a mortgage broker, you have to renew regularly. Most MLO licenses last for one year.

4. Customize your resume

To apply for mortgage broker jobs, you need a resume that reflects your education, related experience and MLO license. In your resume, list relevant coursework and honors, as well as the date of your MLO license and where you earned it.

Related: How to Make a Resume (With Examples)

5. Complete on-the-job training.

Once you have an MLO license, you can start out in an entry-level mortgage broker job. When you first begin, you may have to complete a training program. Most mortgage broker training programs last for a few weeks and are designed to teach new hires about internal processes and workflows.

6. Cultivate important skills.

As you gain experience as a mortgage broker, take every opportunity to cultivate the skills you need to succeed in this industry. For example, you need excellent interpersonal skills to build relationships with lenders and real estate agents, and you should have strong decision-making skills to work smoothly with clients.

To learn technical skills and new mortgage rules, you can take continuing education classes throughout your career. As a mortgage broker, you are required to take a certain number of course hours to renew your license each year.

7. Build a strong network.

You should also take every opportunity to build strong relationships with real estate agents so you can continue to get clients regularly. You can meet real estate agents by attending networking events in your area.

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