Loan Officer Business Plan
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We have helped over 1,000 entrepreneurs and business owners create business plans and many have used them to start or grow their Loan Officer business.
Below is a loan officer business plan template to help you create each section of your Loan Officer business plan.
Executive Summary
Business Overview
Montgomery Mortgage Loan Company is a startup mortgage loan company based in Newton, Massachusetts. The company is founded by Trent Hawthorn, a loan officer who has successfully completed over seven hundred loan packages for individuals during the past fifteen years while working for a large mortgage loan company in nearby Boston, Massachusetts.
Montgomery Mortgage Loan Company will provide loan officers experienced in the full spectrum of lending and mortgage coaching services for individuals or families. Montgomery Mortgage Loan Company will become known for their friendly and experienced loan officers, and also for the results-driven attitudes and affirming responsiveness to applicants who are served by Montgomery Mortgage Loan Company. Montgomery Mortgage Loan Company will project at least 1M in lending business within the first year.
Product Offering
The following are the services that Montgomery Mortgage Loan Company loan officers will provide:
- Conduct initial client meetings to determine lending needs, including refinancing existing loans and first-time mortgages
- Review customer applications; prepares and presents lending packages based on the client specifications
- Assist clients with completion of mortgage applications
- Review applications, research credit histories, report, assess capacities to pay and default risks
- Officers will view or visit properties for real estate purchase or refinance
- Develop and maintain contact with potential clients: realtors, developers, builders and banks or other financial institutions
Customer Focus
Montgomery Mortgage Loan Company will target individuals within the greater Boston region, including nearby townships or smaller areas near Newton.
Management Team
Montgomery Mortgage Loan Company will be owned and operated by Trent Hawthorn, a loan officer who has successfully completed over 450 loan packages for individuals during the past fifteen years while working for a large mortgage loan company in nearby Boston, Massachusetts. He has recruited two key management employees from other loan companies in the area.
Clay Singleton is a mortgage loan officer with ten years of experience in a large, nationally-recognized mortgage loan company. While with his former employer, Clay instituted a streamlined process of analyzing credit worthiness, resulting in a 28% increase in speed and, thereby, a significant reduction in package preparation time. Clay successfully completed over 300 loan packages for individuals and families during the time he was employed by the former mortgage company.
Success Factors
Montgomery Mortgage Loan Company will be able to achieve success by offering the following competitive advantages:
- Friendly, knowledgeable, and highly qualified team of Montgomery Mortgage Loan Company loan officers
- Comprehensive menu of services provided by loan officers who actively work to best represent clients in the lending process–every time on time.
- Montgomery Mortgage Loan Company offers the best pricing in town. Their pricing structure is the most cost effective compared to the competition.
Download the Loan Officer business plan template (including a customizable financial model) to your computer here <–
Financial Highlights
Montgomery Mortgage Loan Company is seeking $200,000 in debt financing to launch its Montgomery Mortgage Loan Company. The funding will be dedicated toward securing the office space and purchasing office equipment and supplies. Funding will also be dedicated toward three months of overhead costs to include payroll of the staff, rent, and marketing costs for the social media campaign and website development. The breakout of the funding is below:
- Office space build-out: $20,000
- Office equipment, supplies, and materials: $10,000
- Three months of overhead expenses (payroll, rent, utilities): $150,000
- Marketing costs: $10,000
- Working capital: $10,000
The following graph below outlines the financial projections for Montgomery Mortgage Loan Company.
Company Overview
Who is Montgomery Mortgage Loan Company?
Montgomery Mortgage Loan Company is a newly established full-service mortgage loan company in Newton, Massachusetts. Montgomery Mortgage Loan Company will be the most reliable, cost-effective, and efficient choice for individuals in greater Boston and the surrounding communities. Montgomery Mortgage Loan Company will provide a comprehensive menu of mortgage loan officer services for any individual customer to utilize. Their full-service approach includes a comprehensive set of loan package services, application oversight and completion of mortgage loans, refinancing or first-time mortgage loan needs.
Montgomery Mortgage Loan Company loan officers will be able to manage all aspects of the mortgage application process, including refinancing and servicing of loans due to the superior customer service offered to individuals and families who seek mortgage loans in a process that can often be daunting and unfamiliar. The team of loan officer professionals are highly qualified and well-experienced in evaluating and processing loan applications and, in particular, assisting individuals through the various mortgage types and options, as well as the thorny questions found within applications and additional requirements of applicants. Montgomery Mortgage Loan Company removes all headaches and issues surrounding mortgages on behalf of their customers and ensures all issues are taken care off expeditiously, while delivering the best customer service.
Montgomery Mortgage Loan Company History
Since incorporation, Montgomery Mortgage Loan Company has achieved the following milestones:
- Registered Montgomery Mortgage Loan Company as a C-corporation to transact business in the state of Massachusetts.
- Has completed the training required for the Nationwide Mortgage Licensing System and Registry (NMLS) and is now licensed to operate in the U.S.
- Has negotiated office space in a corporate office building to set up the services of a mortgage loan company in the 10,000 square foot location.
- Reached out to numerous contacts to include Montgomery Mortgage Loan Company in the databases of available, highly-experienced loan officers.
- Began recruiting a staff of Montgomery Mortgage Loan Company and office personnel to assist and support the mortgage loan officers.
Montgomery Mortgage Loan Company Services
The following will be the services Montgomery Mortgage Loan Company will provide:
- Friendly and highly-experienced loan officers will conduct initial client meetings to determine lending needs, including refinancing existing loans or first-time mortgages
- Confidential and private review of customer applications, customer protections in place to avoid identity theft, and trust-building processes that ensure the customers are comfortable with the overall experience.
- Highly-experienced loan officer conducts application preparation and presents lending packages based on the client specifications
- Review applications, conducts research, may approve loans
- Loan officer views or visits properties for real estate purchase or refinance
- Loan officers develop and maintain contact with potential networking affiliations or collaborations: realtors, developers, builders and banks or other financial institutions
Industry Analysis
The mortgage industry is expected to grow over 7% during the next five years to over $423M. This stable growth will be driven by economic conditions that lead to increased homebuyer or homeowner trust, resulting in refinancing and first-time mortgages, in addition to traditional mortgages for homebuyers. Costs may be reduced in the future, depending on supply chain issues. It is probable that, as supply chain issues are solved and more materials become available, the costs for a loan or mortgage package will be correspondingly reduced. The cost of living expenses for the median of the population in middle-to-upper economic ranges has been steady and will likely continue to be, which stabilizes and supports the mortgage industry growth. As various materials are adapted to green or environmental standards within state laws, construction supplies and new home amenities will also change, reducing the costs of homeownership, which will invite a larger pool of mortgage applicants in the process.
Download the Loan Officer business plan template (including a customizable financial model) to your computer here <–
Customer Analysis
Demographic Profile of Target Market
Montgomery Mortgage Loan Company will target those individuals and corporations in the greater region of Boston, Massachusetts in need of a mortgage or refinance package. They will also target first-time homebuyers with a strategic effort to take university graduates and other young adults into condominiums and other attached home scenarios as first-time homebuyers.
The precise demographics for Montgomery Mortgage Loan Company are:
| Total | Percent | |
|---|---|---|
| Total population | 1,680,988 | 100% |
| Male | 838,675 | 49.9% |
| Female | 842,313 | 50.1% |
| 20 to 24 years | 114,872 | 6.8% |
| 25 to 34 years | 273,588 | 16.3% |
| 35 to 44 years | 235,946 | 14.0% |
| 45 to 54 years | 210,256 | 12.5% |
| 55 to 59 years | 105,057 | 6.2% |
| 60 to 64 years | 87,484 | 5.2% |
| 65 to 74 years | 116,878 | 7.0% |
| 75 to 84 years | 52,524 | 3.1% |
Customer Segmentation
Montgomery Mortgage Loan Company will primarily target the following customer profiles:
- Individuals and families who are refinancing or applying for a new mortgage
- First-time homebuyers who have never applied for a mortgage or large loan
- Corporations with affiliation or collaboration potential
- Community, civic or governmental agencies with specific loan funding needs
Competitive Analysis
Direct and Indirect Competitors
Montgomery Mortgage Loan Company will face competition from other companies with similar business profiles. A description of each competitor company is below.
TRS Mortgage Services
TRS Mortgage Services is a mortgage loan company based in Newton, Massachusetts. It is a direct competitor to the Montgomery Mortgage Loan Company, with the primary focus on first-time homebuyers who may have little to no knowledge of the homebuying process.
TRS Mortgage Services is a C-corporation and is owned by a family group with ten siblings and cousins included on the corporate register. It has 20 employees and advertises heavily to the young adult demographic, targeting under-represented nationalities within the American home buyer statistical experience. Their motto is, “Let Us Find Your First and Last Home,” and the target audience is directed toward “security” and “safety” for homeowners in the marketing strategies applied.
Silver Estates Home Loans
Silver Estates Home Loans is a direct competitor to the Montgomery Mortgage Loan Company. The company has segmented one portion of the mortgage loan industry, however, within the mobile or manufactured home mortgage loan services arena. Manufactured or mobile homes are not typically included in federal or state buying incentive programs due to the rent payments owed on a monthly basis for the land on which the manufactured homes sit. While this fact invalidates much of the mortgage loan market, Silver Estates Home Loans and others focus on meeting that niche target market and excelling within it.
Silver Estates Home Loans is an S-corporation owned by Connie Lyn and Heidi Matthews, who started the home loan company in 2015 as a result of being unable to secure a loan for their own purposes in purchasing a mobile home. Silver Estates Home Loans now services “kit” or pre-manufactured homes, as well, whether on land that is owned or leased.
Sunnyside Home Loans
Sunnyside Home Loans is a direct competitor and is owned by Hank and Mae Marsten, who formed a Limited Liability Company as the legal entity under which it operates. Sunnyside Home Loans has targeted home refinancing, first-time buyer mortgages and second mortgages for homeowners within the Boston region. A target area is that of seniors who need second mortgages for homes with no mortgages and reverse mortgage loans for seniors who need liquid assets for living expenses.
Sunnyside Home Loans collaborates with federal senior agencies and the American Association of Retired Persons (AARP) to provide mortgage application education seminars and other support systems so seniors can better understand mortgage processes. They also provide application support and expanded communication for seniors in need of comprehensive assistance.
Download the Loan Officer business plan template (including a customizable financial model) to your computer here <–
Competitive Advantage
Montgomery Mortgage Loan Company will be able to offer the following advantages over their competition:
- Friendly and highly-experienced loan officers will conduct initial client meetings to determine lending needs, including refinancing existing loans or first-time mortgages
- Confidential and private review by loan officers of customer applications, customer protections in place to avoid identity theft, and trust-building processes that ensure the customers are comfortable with the process.
- Highly-experienced mortgage loan officers will conduct application preparation and present lending packages based on the client specification
- Loan officers will assist clients with completion of mortgage applications
- Loan officers will review applications, conducts research, may approve loans
- Loan officers will view or visit properties for real estate purchase or refinance
- Loan officers will develop and maintain contact with potential networking affiliations or collaborations: realtors, developers, builders and banks or other financial institutions
Loan Officer Marketing Plan
Brand & Value Proposition
Montgomery Mortgage Loan Company will offer the unique value proposition to its clientele:
- Highly-qualified team of skilled loan officers who are able to provide comprehensive assistance to applicants in the home loan market sector.
- Unbeatable service in pricing for its clients. Montgomery Mortgage Loan Company loan officers will offer the lowest prices and percentage rates for the services offered and the ancillary costs attached to the loan processes.
Promotions Strategy
The promotions strategy for Montgomery Mortgage Loan Company is as follows:
Referral Marketing
Trent Hawthorn has built up an extensive list of contacts over the years by providing exceptional service and expertise to his clients. They have communicated to Trent that they kept returning for all their home mortgage needs because they were happy with the services Trent was providing as a loan officer. Once Trent advised them he was leaving to open his own mortgage loan business, they signaled their commitment to follow him to his new company and help spread the word of the Montgomery Mortgage Loan Company. This audience will be a great source of referral marketing.
Professional Associations and Networking
The pivotal area of networking will be attended to by both Trent Hawthorn and Clay Singleton, who together have over 25 years of mortgage loan officer experience. The potential for networking or joining association memberships is found in the affiliations that make sense for mortgage loan officers: real estate brokers, commercial brokers, mortgage companies, and banks or other financial institutions. These associations and networking opportunities pave the way for business, both in the immediate and long-term future.
Social Media Marketing
The oversight of social media marketing will be handled on a short-term basis by a part-time social media manager. This will include posting on social media, adding video reels, podcasts, images and other announcements that intrigue potential customers to contact the firm. The entities involved will be converted to followers on social media, who will continue to follow if material is relevant, timely and well-executed. Young adults are the largest target for this medium and they are also first-time buyers who will be researching mortgage loans and loan officers.
Website/SEO Marketing
Montgomery Mortgage Loan Company will utilize their short-term social media marketing manager who oversees the social platforms to also design their website. The website will be well organized, informative, and list all the services that the Montgomery Mortgage Loan Company is able to provide. The website will also list their contact information and list their available interest rates and other salient information for homebuyers who are watching economic indicators.
The social media manager will also manage the website presence with SEO marketing tactics so that anytime someone types in the Google or Bing search engine, “Boston mortgage loan company” or “mortgage loan company near me”, Montgomery Mortgage Loan Company will be listed at the top of the search results.
Pricing
The pricing of Montgomery Mortgage Loan Company will be moderate and on par with competitors so customers feel they receive excellent value when purchasing their services.
Operations Plan
The following will be the operations plan for Montgomery Mortgage Loan Company.
Operation Functions:
- Trent Hawthorn will be the Owner and President of the company. He will oversee all staff and manage client relations. Trent has recruited the following staff:
- Clay Singleton – General Manager and Senior Loan Officer who will oversee the loan officers and handle human resources onboarding and other day-to-day operations.
- Stuart Asbury – Loan Officer, who will advise and assist corporations with mortgage loan packages.
- Elizabeth Stanton – Loan Officer, who will advise and assist homebuyers in loan packages and application processes.
Download the Loan Officer business plan template (including a customizable financial model) to your computer here <–
Milestones:
Montgomery Mortgage Loan Company will have the following milestones complete in the next six months.
- 5/1/202X – Finalize contract to lease office space
- 5/15/202X – Finalize personnel and staff employment contracts for the Montgomery Mortgage Loan Company
- <6/1/202X - Begin networking at corporate levels
- 6/15/202X – Begin networking at mortgage industry events
- 6/22/202X – Begin moving into Montgomery Mortgage Loan Company office
- 7/1/202X – Montgomery Mortgage Loan Company opens its office for business
Management Team
Montgomery Mortgage Loan Company will be owned and operated by Trent Hawthorn, a mortgage loan officer who has successfully completed over 450 loan packages for individuals during the past fifteen years while working for a large mortgage loan company in nearby Boston, Massachusetts. He has recruited two key management employees from other loan companies in the area.
Clay Singleton is a mortgage loan officer with ten years of experience in a large, nationally-recognized mortgage loan company. While with his former employer, Clay instituted a streamlined process of analyzing credit worthiness, resulting in a 28% increase in speed and, thereby, a significant reduction in package preparation time. Clay successfully completed over 300 loan packages for individuals and families during the time he was employed by the former mortgage company.
Financial Plan
Key Revenue & Costs
The revenue drivers for Montgomery Mortgage Loan Company are the loan origination fees and associated costs charged to the customers for their services. .
The cost drivers will be the overhead costs required in order to staff the Montgomery Mortgage Loan Company. The expenses will be the payroll cost, rent, utilities, office supplies, and marketing materials.
Funding Requirements and Use of Funds
Montgomery Mortgage Loan Company is seeking $200,000 in debt financing to launch its mortgage loan business. The funding will be dedicated toward securing the office space and purchasing office equipment and supplies. Funding will also be dedicated toward three months of overhead costs to include payroll of the staff, rent, and marketing costs for the marketing campaign and association memberships. The breakout of the funding is below:
- Office space build-out: $20,000
- Office equipment, supplies, and materials: $10,000
- Three months of overhead expenses (payroll, rent, utilities): $150,000
- Marketing costs: $10,000
- Working capital: $10,000
Download the Loan Officer business plan template (including a customizable financial model) to your computer here <–
Key Assumptions
The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.
- Number of Applications Processed and Closed Per Month: 90
- Average Costs per Month: $65,000
- Office Lease per Year: $100,000
Financial Projections
Income Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Total Revenues | $360,000 | $793,728 | $875,006 | $964,606 | $1,063,382 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $64,800 | $142,871 | $157,501 | $173,629 | $191,409 | |
| Lease | $50,000 | $51,250 | $52,531 | $53,845 | $55,191 | |
| Marketing | $10,000 | $8,000 | $8,000 | $8,000 | $8,000 | |
| Salaries | $157,015 | $214,030 | $235,968 | $247,766 | $260,155 | |
| Initial expenditure | $10,000 | $0 | $0 | $0 | $0 | |
| Total Expenses & Costs | $291,815 | $416,151 | $454,000 | $483,240 | $514,754 | |
| EBITDA | $68,185 | $377,577 | $421,005 | $481,366 | $548,628 | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| EBIT | $41,025 | $350,417 | $393,845 | $454,206 | $521,468 | |
| Interest | $23,462 | $20,529 | $17,596 | $14,664 | $11,731 | |
| PRETAX INCOME | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Use of Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Taxable Income | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Income Tax Expense | $6,147 | $115,461 | $131,687 | $153,840 | $178,408 | |
| NET INCOME | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 |
Balance Sheet
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $30,000 | $33,072 | $36,459 | $40,192 | $44,308 | |
| Total Current Assets | $184,257 | $381,832 | $609,654 | $878,742 | $1,193,594 | |
| Fixed assets | $180,950 | $180,950 | $180,950 | $180,950 | $180,950 | |
| Depreciation | $27,160 | $54,320 | $81,480 | $108,640 | $135,800 | |
| Net fixed assets | $153,790 | $126,630 | $99,470 | $72,310 | $45,150 | |
| TOTAL ASSETS | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $315,831 | $270,713 | $225,594 | $180,475 | $135,356 | |
| Accounts payable | $10,800 | $11,906 | $13,125 | $14,469 | $15,951 | |
| Total Liability | $326,631 | $282,618 | $238,719 | $194,944 | $151,307 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| Total Equity | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| TOTAL LIABILITIES & EQUITY | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 |
Cash Flow Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | ||||||
| Net Income (Loss) | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 | |
| Change in working capital | ($19,200) | ($1,966) | ($2,167) | ($2,389) | ($2,634) | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| Net Cash Flow from Operations | $19,376 | $239,621 | $269,554 | $310,473 | $355,855 | |
| CASH FLOW FROM INVESTMENTS | ||||||
| Investment | ($180,950) | $0 | $0 | $0 | $0 | |
| Net Cash Flow from Investments | ($180,950) | $0 | $0 | $0 | $0 | |
| CASH FLOW FROM FINANCING | ||||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 | |
| Cash from debt | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow from Financing | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow | $154,257 | $194,502 | $224,436 | $265,355 | $310,736 | |
| Cash at Beginning of Period | $0 | $154,257 | $348,760 | $573,195 | $838,550 | |
| Cash at End of Period | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 |
Loan Officer Business Plan FAQs
What Is a Loan Officer Business Plan?
A loan officer business plan is a plan to start and/or grow your loan officer business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.
You can easily complete your Loan Officer business plan using our Loan Officer Business Plan Template here.
What are the Main Types of Loan Officer Businesses?
There are a number of different kinds of loan officer businesses, some examples include: Commercial Loan Officer, Consumer Loan Officer, and Mortgage Loan Officer.
How Do You Get Funding for Your Loan Officer Business Plan?
Loan Officer business plans are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.
What are the Steps To Start a Loan Officer Business?
Starting a loan officer business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.
1. Develop A Loan Officer Business Plan - The first step in starting a business is to create a detailed loan officer business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.
2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your loan officer business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your loan officer business is in compliance with local laws.
3. Register Your Loan Officer Business - Once you have chosen a legal structure, the next step is to register your loan officer business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.
4. Identify Financing Options - It’s likely that you’ll need some capital to start your loan officer business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.
5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.
6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.
7. Acquire Necessary Loan Officer Equipment & Supplies - In order to start your loan officer business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.
8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your loan officer business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.