How to become a loan officer without experience in 6 steps

By Indeed Editorial Team

Published 9 July 2022

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.

Becoming a loan officer can be rewarding if you enjoy interacting with others and have an interest in finance. Loan officers evaluate the creditworthiness of applicants for residential or commercial mortgages and consumer or business loans. If you want to become a loan officer and don't have experience, it's important to understand how you can still pursue this career. In this article, we explain how to become a loan officer without experience, discuss the roles of a loan officer and highlight some of their key skills.

What is a loan officer?

Loan officers are finance professionals who help clients determine whether they qualify for loans. They often work in financial institutions, such as in bank credit departments. Loan officers may arrange meetings with customers to review their loan applications and authorise or recommend approval. They may authorise a loan depending on the client's creditworthiness, among other factors, and may sometimes help to follow up payments on existing loans.

How to become a loan officer without experience

Here are steps on how to become a loan officer without experience:

1. Earn a degree

Earning a degree is not a requirement to become a loan officer, but it can be helpful. Most loan officers obtain a bachelor's degree in business, accounting or finance. You can get a degree in any business-related subject, but look for those that include courses in business law, financial management, international finance, financial accounting and business strategy.

Related: Types of roles in banking, their salaries and primary duties

2. Choose a specialisation

As a loan officer, you can specialise in one type of lending. You can decide to take the route of a consumer, commercial or mortgage loan officer. Whichever path you choose, continue taking steps towards developing your chosen specialisation. Having a specialisation can help you conduct a targeted job search.

Related: UK finance sector overview and industry guide (with FAQs)

3. Update your CV

Before applying for jobs, consider updating your CV to include your relevant skills. Most CVs include an experience section, but if you don't have experience, it's important to add additional sections to help demonstrate that you're as competent as other candidates with experience. You can include sections such as:

  • Volunteer experience: Volunteer experiences can demonstrate your passion and ability to engage people. It can also show that you possess flexibility, teamwork, confidence and collaboration skills.

  • Clubs or sports: You can include your experience in any clubs or sports in your CV. Taking part in sports or clubs often demonstrates to potential employers that you have skills such as self-direction, commitment, leadership and teamwork, which are relevant to a loan officer career.

4. Apply for entry-level positions as a loan officer

If you don't have experience as a loan officer, gaining entry-level positions can help you work towards becoming one. You can consider entry-level jobs such as a teller in a credit union or a bank. Working in this position might enable you to shadow a loan officer, helping you learn what the job requires. It might also be an excellent opportunity to show your readiness to accept more responsibilities.

5. Advance in your loan officer career

After gaining experience in entry-level positions, keep advancing in your loan officer career. As you research for job opportunities in a senior position, you can gain one or two years of experience in an entry-level position. You can consider advancing your education level during this period by obtaining an additional degree or enrolling for a master's degree in a related field. You can also get certifications that can help you advance your career.

6. Continue learning

To be successful and remain relevant in your loan officer career, consider continued learning. You can attend forums or networking events to learn more about your profession and meet other loan officers. That way, you get to know of any new opportunities arising and stay up to date with current trends in your field.

Related: How To Become a Debt Collector

What are the roles of a loan officer?

Here are some of the primary roles of a loan officer:

  • finding potential clients in need of loans

  • presenting clients with various loan options and advising them on the best option for them

  • maintaining accurate and detailed documents on loan transactions

  • analysing loan applications to determine whether to approve the loan

  • educating the public on applying for loans

  • identifying future loan applicants through seminars or advertisement

  • ensuring that loans meet current standards and requirements

  • collecting borrower's financial information, such as debt and taxes

  • drafting offer letters outlining all the loan requirements, such as interest and dates of payment

Related: 15 of the highest paid jobs in banking (with salaries)

What is the work environment of a loan officer?

A loan officer primarily works in an office, but it may also depend on your specialism. For example, if you work as a mortgage loan officer, you can expect to travel to meet your clients at their homes regularly. A loan officer job is a full-time position, with most working over 40 hours per week. Your work may also involve following up with clients on payments, and you may sometimes be present in auctioning items for customers who default on loans. This can be a challenging task, requiring confidence and consistency.

Related: Average banking salary in the UK (plus ways to earn more)

What are some of the key skills of a loan officer?

Here are some of the key skills of a successful loan officer:

Financial skills

Loan officers require financial skills to perform their tasks. Having excellent financial knowledge can help you explain various loan options and their implications to borrowers. You may also spend lots of your time reviewing finances, including your client's income and credit scores, to help you determine if they qualify for a loan. You can improve your financial skills by earning a degree or certification in a finance-related course.

Interpersonal skills

As a loan officer, you may often explain loan options to clients who have little or no knowledge of finance and loan terms. Interpersonal skills can help you communicate clearly and simply to ensure borrowers understand the loan process. These skills can also help you determine your client's financial needs, enabling you to answer any questions they may have and advise them accordingly.

Related: Interpersonal skills: definitions and examples

Time management

Loan officers often work on processing multiple loans simultaneously. Organisational and time management skills can help you plan and prioritise your work, helping you keep track of all your client's paperwork and licensing requirements. You can manage your time by creating schedules and timelines for each task. It's also important that you keep track of all loans to follow up on due payments.

Related: Time-management skills: definition, examples and tips for improvement

Attention to detail

As a loan officer, you may deal with lots of paperwork. Attention to detail is important to help you analyse loan applications effectively so you're giving loans to people who qualify. Confirm that the borrower's information is correct, and ensure that you specify the right loan amount and interest rates.

Computer skills

Most loan officers work in banks or other financial institutions that use various software for their operations. Basic computer skills can help you adapt to new digital platforms and services. These skills can also help you use financial software applications to service a loan.

Customer service

It's important to relate with your customers in a friendly and professional manner to be a successful loan officer. Your work involves dealing with customers daily, and you're the main point of contact whenever they have a question about loans. You can improve your customer service skills by pursuing a course in customer service or knowing your product.

Related: 10 ways to consistently offer good customer service

Decision-making skills

A loan officer's role is to approve or recommend approval for a loan application. It's important to use the available information to determine if a customer is creditworthy. Your decision may be the final one, and it's thus important that you're confident in your decision-making skills. Doing extensive research and taking time before deciding can help improve your decisiveness.

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