Blog with MAE Capital

Loan Officer Compensation Spherical Income Model

June 18th, 2012 11:03 AM by Gregg Mower

What is a Spherical Income model you ask? Well in the mortgage industry we have gone through extensive regulation on both the loan documentation front as well as the way Mortgage Loan Originators can be paid. I have focused much time already on the industry changes and the detriment it has caused the consumer trying to get a home loan in this new age lending environment. Now let’s focus on a new way of Loan officer compensation. This compensation Model is created for the Mortgage Broker and will not work with an established Mortgage Banker as the accounting would be too complex for them. As you know most Loan Officers are paid commission for their services. At MAE Capital Mortgage INC we have created a model for Originators that will reward them not only for closing loans but also for recruiting. The way it works it simple, once a Loan Officer has recruited 2 other Loan Officers he or she will receive .125% of all their production from the company side of the commission. In addition, if those recruited Loan Officers recruit 2 more then they recruit 2 more you will get .125% on all of their production. This is so cutting edge, I think that when most Loan Officers see this model they will rush out and try to recruit more Loan Officers for their own downstream income. This additional income will last for the Loan Officer for His or Her entire career and into retirement. The possibilities here are endless for individuals that are motivated in their career. Theoretically if you are a good promoter of the business you could make more money in downstream spherical income than your own monthly production. Loan Originators can now use their selling skills to create another income stream while doing the career they have worked in and have made a good living their whole life by simply hiring their peers to join a strong innovative company that has the Originators best interest in hand. In this simple model you are at the top and assuming all 14 individuals under you close 2 $100,000 loans per month at .125% to you, you would make an additional $3,500 a month without having to do an extra thing and the more people you put on your first tier (or yellow people in the model) the more down line income you could get. This model is just showing you recruiting 2 Loan Officers if you recruit 4 you can now visualize the spherical income affect.

Posted in:General
Posted by Gregg Mower on June 18th, 2012 11:03 AM

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