Loan Officer

Loan Officer Career Overview: A loan officer assists prospective clients in applying for loans and in determining the type and amount of loan that is most suitable for their needs. A loan officer also assesses the creditworthiness of loan applicants, judging their suitability as borrowers and the precise terms (interest rate, repayment schedule, etc.) on which credit may be granted to them. Depending on the position, a loan officer may be expected to actively seek out clients, rather than passively wait for applicants to approach his or her financial institution (bank, credit union, etc.) for credit.

Loan Officer vs. Credit Counselor: The Bureau of Labor Statistics considers a credit counselor to be a subcategory of loan officer, with similar skill sets and levels of compensation.

Loan Officer Specialization: A loan officer tends to specialize in one of three major types of lending: commercial, consumer or mortgage. Commercial lending is the extension of credit to businesses. Consumer lending includes personal loans, education loans, home equity loans and auto loans, among others. Mortgage lending includes loans for the purchase of real estate by individuals (a business normally would be served by a commercial loan officer, even for real estate purchases) or the refinancing of existing mortgages.

Loan Officer Education: A Bachelor's Degree is expected for a loan officer. Coursework in finance, accounting and/or economics is helpful, though not required. Strong quantitative and analytic skills are vital. An MBA can give you a leg up in the hiring process, depending on the firm.

Loan Officer Certification: Most loan officer positions do not require any special certification or licensing. A notable exception, however, is mortgage lending. Most states regulate this field, especially regarding loan officer positions in mortgage banks or mortgage brokerages, rather than in traditional banks or credit unions.

Loan Officer Duties and Responsibilities: The majority of loan officer positions combine sales responsibilities with analytic requirements: selling loans while determining who are appropriate clients, and on what terms. Some loan officer positions are focused largely on the analytics, with no sales dimension and limited client contact. People in these types of jobs are sometimes called loan underwriters. Other loan officer positions specialize in dealing with clients who are having problems meeting their payments. One example is a loan collection officer, who tries to work out agreements with troubled borrowers that adjust the repayment terms.

Loan Officer Typical Schedule: The majority of people in loan officer jobs tend to work a standard 40 hour week. A consumer loan officer is most likely to work set hours from a fixed location, such as a bank branch or office. A commercial or mortgage loan officer often has to work variable hours to confer with clients at the latter's places of work or residence, and thus spend significant time out of the office and on the road.

What's to Like About Being a Loan Officer: Depending on the firm and its policies, a loan officer can have a large degree of professional autonomy, more akin to being an independent entrepreneur than a corporate employee. If the compensation scheme is largely commission-based, there is a close correlation between performance and reward, with high earnings potential. Also, doing your job well can make a discernible, positive impact on your clients' lives.

What's Not to Like About Being a Loan Officer: Rejecting loan applicants who do not meet your institution's lending criteria can be an unpleasant process, as can dealing with clients who have run into financial difficulties and cannot repay their loans as agreed. Also, loan officers who are expected to prospect for new clients can be under heavy pressure to perform, the downside of the greater earning potential that such a position offers.

Loan Officer Salary Range: Per the Bureau of Labor Statistics, median annual compensation was about $52,000 as of May 2006, with the top 10% earning over $107,000. Compensation schemes vary by employer, with varying mixtures of salary and commission. Where commissions are paid, they normally reflect the number and/or value of loans originated. The highest pay packages for a loan officer tend to be commission-based and at large institutions.

From :      About.com
Source:   http://financecareers.about.com/od/banker/a/loanofficer.htm
For:           public Information, non profitable 
Author:  Mark Kolakowski,

Public Finance

Public finance is a field of economics concerned with paying for collective or governmental activities, and with the administration and design of those activities. The field is often divided into questions of what the government or collective organizations should do or are doing, and questions of how to pay for those activities. The broader term, public economics, and the narrower term, government finance, are also often used.

The purview of public finance is considered to be threefold: governmental effects on (1) efficient allocation of resources, (2) distribution of income, and (3) macroeconomic stabilization.

Overview 

The proper role of government provides a starting point for the analysis of public finance. In theory, under certain circumstances private markets will allocate goods and services among individuals efficiently (in the sense that no waste occurs and that individual tastes are matching with the economy's productive abilities). If private markets were able to provide efficient outcomes and if the distribution of income were socially acceptable, then there would be little or no scope for government. In many cases, however, conditions for private market efficiency are violated. For example, if many people can enjoy the same good at the same time (non-rival, non-excludable consumption), then private markets may supply too little of that good. National defense is one example of non-rival consumption, or of a public good.

"Market failure" occurs when private markets do not allocate goods or services efficiently. The existence of market failure provides an efficiency-based rationale for collective or governmental provision of goods and services. Externalities, public goods, informational advantages, strong economies of scale, and network effects can cause market failures. Public provision via a government or a voluntary association, however, is subject to other inefficiencies, termed "government failure."

Under broad assumptions, government decisions about the efficient scope and level of activities can be efficiently separated from decisions about the design of taxation systems (Diamond-Mirlees separation). In this view, public sector programs should be designed to maximize social benefits minus costs (cost-benefit analysis), and then revenues needed to pay for those expenditures should be raised through a taxation system that creates the fewest efficiency losses caused by distortion of economic activity as possible. In practice, government budgeting or public budgeting is substantially more complicated and often results in inefficient practices.

Government can pay for spending by borrowing (for example, with government bonds), although borrowing is a method of distributing tax burdens through time rather than a replacement for taxes. A deficit is the difference between government spending and revenues. The accumulation of deficits over time is the total public debt. Deficit finance allows governments to smooth tax burdens over time, and gives governments an important fiscal policy tool. Deficits can also narrow the options of successor governments.

Public finance is closely connected to issues of income distribution and social equity. Governments can reallocate income through transfer payments or by designing tax systems that treat high-income and low-income households differently.

The Public Choice approach to public finance seeks to explain how self-interested voters, politicians, and bureaucrats actually operate, rather than how they should operate.

From :   Wikipedia, the free encyclopedia
Source: http://en.wikipedia.org/wiki/Public_finance
For:         Public Information, non profitable