Pros and Cons of a Career as a Loan Documentation Representative
Loan documentation representatives, also referred to as loan clerks, are primarily responsible for preparing, assembling, processing and double-checking the paperwork that gets passed between prospective lenders and loan officers. Learn more about the pros and cons of a career as a loan document representative to make an informed decision about your future.
|Pros of a Loan Documentation Representative Career|
|Minimal educational requirements (most positions require only a high school diploma)*|
|Regular, full-time hours (except for busy loan seasons, the hours required of someone in this occupation are rather normal)*|
|On-the-job training is usually provided*|
|Satisfaction of assisting people with obtaining funds for major purchases*|
|Cons of a Loan Documentation Representative Career|
|Average job prospects (11% job growth was predicted from 2014-2024)|
|Median salary is relatively low (around $17.00 per hour, as of May 2014)*|
|Have to give bad news to applicants who are denied loans**|
|Work can be tedious and repetitious (verifying information, inputting data, completing paperwork*|
Sources: *U.S. Bureau of Labor Statistics, **O*NET OnLine.
Job Description and Duties
As a loan documentation representative, you'll be responsible for ensuring that all of the documentation associated with a loan is filled out correctly, filed, organized and accessible. Loan documentation representatives typically work 40-hour workweeks for financial institutions, such as institution, banks, credit unions and other lenders.
Your specific duties may include inputting credit, loan and disbursement information into a computer, verifying and evaluating the accuracy of the information on loan documents, informing customers of their loan repayment schedules and auditing documents. You may also be required to understand the internal company procedures regarding loan processing and documentation, as well as the government codes and statutes that regulate lending. Additionally, since not all borrowers are approved for loans, you may have to deliver bad news and maintain your composure in the face of customer aggression.
Salary Info and Employment Outlook
According to Salary.com, the median annual salary for banking and commercial loan-processing clerks nationwide is around $32,000. The BLS predicted that jobs for loan interviewers and clerks would rise 9% from 2014-2024. This outlook can be largely attributed to stricter loan regulations and the need for professionals to review the integrity of loan applications.
Career Skills and Requirements
A high school diploma or its equivalent is the typical entry-level requirement for this profession. Most companies also provide on-the-job training, which can take up to a month to complete. Your professional duties as a loan documentation representative may often require you to multitask, work in teams, communicate with coworkers, talk with customers about their loan status and write reports. In addition, you may also need to know how to navigate loan-processing software and basic office technologies, such as paper shredders, fax machines and voice mail systems. The job could also demand less tangible characteristics, such as:
- Effective interpersonal skills
- A flexible personality capable of adapting to conditions in a fast-paced work environment
- The ability to communicate complex concepts clearly and concisely
- A strong work ethic
- Real passion for helping people
Job Postings from Real Employers
Employers typically look for candidates who are proficient in basic word processing and data processing software and who can quickly learn relevant programs, such as the LaserPro loan processing system. In addition, they also prefer candidates who are organized and who pay attention to detail. The following is a list of some actual job postings found in March 2012 on Careerbuilder.com:
- A consumer specialty finance company located in Chicago advertised for a loan-processing representative who would verify, assemble and maintain all loan documentation between the customer and the third party processing entity. The employer preferred a candidate with a bachelor's degree and prior telephone-based sales experience.
- A Birmingham bank looked for a loan document specialist to process home equity loans, auto loans and certificates of deposit (CD). The employer required candidates to have at least five years of experience in banking and at least three years of experience in loan processing. In addition, successful candidates would hold at least a high school diploma or its equivalent.
- A bank in Houston advertised for a loan documentation specialist who would audit its in-house loan documentation. The successful candidate would have at least an associate's degree, six months of related experience or a combination of sufficient banking experience and education.
How to Stand Out
Some banks and loan agencies are already transitioning to internet-based loan processing systems. This has necessitated that they hire loan-processing clerks who can adapt to new software technologies. Thus, the ability to tailor your skills to the latest industry technologies may separate you from the crowd of other processing clerks. Some high schools offer classes in computing technology, and it could be beneficial to enroll, especially if you're not particularly computer savvy. Additionally, taking classes in mathematics could also help prepare you for this career field and help you stand out when applying for jobs.
The National Association of Mortgage Processors (NAMP) offers professional certifications for loan processors, which could help you to stand out. If you have little or no experience in the field, obtaining the Certified Purple Processor (CPP) could help you increase your job prospects, according to the NAMP. More experienced closers who have at least 5 years of experience under their belt or who are willing to complete 24 hours of training can apply for the Certified Master Loan Processor designation. To obtain certification, you'll have to agree to follow the organization's code of conduct and ethical standards, pass a background check and pay a fee, as well as meet the experience or education requirements for the level of certification you wish to obtain.
Other Careers to Consider
If you'd like to work in the lending industry but would rather work in a higher-paying position with better job prospects, a career as a loan officer could be a better fit. These professionals meet with potential borrowers and obtain relevant financial documents to determine whether or not they are eligible for a loan. They also explain the terms of different types of loans to customers and assist them through the lending process. A high school diploma or its equivalent and a Mortgage Loan Originator license are required to enter the field. As of May 2011, loan officers earned a median annual salary of around $58,000, according to the BLS. The number of jobs was projected to grow 14% from 2010-2020, which is as about average.
Individuals who enjoy recording and verifying financial information may enjoy jobs as bookkeepers, accountants or auditing clerks. Unlike jobs for loan documentation representatives, which are in a decline, jobs for bookkeepers, accounts and auditing clerks were predicted to increase 14% from 2010-2020, according to the BLS. These professionals maintain financial records for organizations, update financial statements and create financial reports. To enter this field, a high school diploma or its equivalent is typically required. According to the BLS in May 2011, the median annual wage for these professionals was about $35,000.