Mortgage Consultants: Their Revenue Streams And Money-Making Strategies

Mortgage consultants, also known as mortgage brokers, assist customers in navigating the home-buying process and making decisions that are in their best financial interests. They are compensated either by the borrower or the lender, earning money through commissions, fees, and bonuses. The average yearly salary for a mortgage consultant can vary depending on location, experience, and seniority, ranging from approximately $37,000 to $380,000. In the United States, the average salary for a home mortgage consultant is estimated to be $163,042 per year.

Mortgage consultant salaries

The salary of a mortgage consultant in the United States varies depending on the source of information and the date of publication. According to ZipRecruiter, as of February 2025, the average annual pay for a mortgage consultant is $96,593, with a range of $33,000 to $160,500. This estimate suggests that skill level, location, and years of experience can influence the salary, with the top earners (90th percentile) making $160,000 annually.

In contrast, Glassdoor reported a higher average salary of $107,725 per year for a mortgage consultant in October 2022. The Glassdoor estimate also includes additional pay of $53,735 per year, which could come from cash bonuses, commission, tips, and profit sharing. The highest salary reported on Glassdoor was $190,459 per year.

Additionally, specific companies and roles within the mortgage consulting field can offer different salaries. For example, the average salary for a Home Mortgage Consultant at Wells Fargo was estimated to be $163,042 per year, with the salary range starting at $123,114 and going up to $380,788 for the highest level of seniority.

Indeed.com provided a lower average salary figure of $37,256 per year for Wells Fargo Mortgage Consultants, which is 36% below the national average. Another estimate from Indeed.com, updated in August 2024, reported an average salary of $65,362 per year for mortgage consultants in the United States.

The variation in salary estimates across different sources highlights the dynamic nature of compensation in this field. Factors such as location, experience, and specific job roles play a significant role in determining the earning potential of mortgage consultants.

Commission and bonuses

Mortgage consultants can make money through commission and bonuses. The commission is usually a percentage of the loan amount, typically ranging from 1% to 2%. Before April 1, 2011, mortgage brokers could earn money on both the front and back ends of a mortgage loan. They could charge a loan origination fee to the borrower and receive a yield spread premium (YSP) or commission from the lender. The YSP was linked to a mortgage rate above the market rate, so the higher the interest rate, the more the broker earned from the lender.

Following regulatory changes, mortgage brokers can now only be paid by the borrower or the lender for each loan, not both. They can either charge the borrower directly for their services, such as a broker or origination fee, or receive compensation from the lender, which the borrower pays indirectly through a higher interest rate. This compensation plan must be agreed upon upfront with each lender. Some lenders may also offer a flat fee as part of the broker's total compensation.

Mortgage consultants who are employed by a specific lender, such as loan officers, receive a set salary and bonuses. Their bonuses could be in the form of additional pay, cash bonuses, profit-sharing, or other incentives. For example, Wells Fargo offers benefits such as matching 401K contributions and health insurance. The estimated total pay for a home mortgage consultant in the United States is $197,067 per year, with an average salary of $135,340 and an estimated additional pay of $61,728. However, salaries can vary widely, with entry-level positions starting at an average of $36,107 per year and experienced consultants earning up to $95,000 or even $380,788 annually.

Yield spread premiums

Yield spread premium (YSP) is a form of compensation that a mortgage broker receives from the originating lender for selling a loan with an interest rate above the lender's par rate for which the borrower qualifies. The YSP can be used to cover costs associated with the loan, such as closing costs and origination fees, so that the borrower does not have to pay additional fees. This results in the borrower paying a higher monthly mortgage and more interest over the duration of the loan term.

The yield spread premium is calculated based on the difference between the interest rate at which the broker originates the loan and the par or market rate offered by the lender. This payment allows the broker to recoup the upfront costs incurred on the borrower's behalf in originating the loan. The yield spread premium is considered an "indirect" fee and is paid by the lender to the broker as compensation for placing a higher-interest loan with a borrower.

Prior to the Great Recession, it was common for mortgage brokers to charge a yield spread premium as a way to provide a no-closing-cost loan. For example, a broker might charge no mortgage points or fees but would then charge a YSP of 2% on a $400,000 loan. The YSP would be used to cover the fees associated with the loan, and the remaining amount would be kept by the broker as commission.

In 1999, legislation was passed to protect homebuyers against exorbitant yield spread premium fees, and in 2010, the Dodd-Frank Act banned the practice of YSP altogether. This legislation was put in place to protect consumers after the 2008-2009 financial crisis and to address the controversy surrounding whether YSPs violated the provisions of the Real Estate Settlement Procedures Act (RESPA).

Broker fees

Mortgage origination fees are now limited to 3% of the loan amount. This includes any fees to your loan officer, and any fees that the lender is charging for underwriting. Brokers may be compensated by one party, either the lender (lender-paid compensation) or the borrower, but never both.

Some common types of broker fees include:

• Loan origination fees: The most common cost of doing business with a broker, a loan origination fee usually costs a percentage of the total value of the loan. The larger the loan, the lower the percentage charged.
• Upfront fees: Usually an option for borrowers looking for a more expensive home. Most upfront fees will be a flat cost for the service arrangement.
• Loan administration fees: Some mortgage companies charge extra "administrative" costs and charges on top of their loans.
• Yield-spread premium: A yield-spread premium is a type of bonus payment given to a mortgage broker by a lender in exchange for getting a borrower to accept a higher interest rate than is available on the market.

Career trajectory

The career trajectory of a mortgage consultant can vary depending on their experience, performance, and the organisation they work for.

Mortgage consultants are typically compensated through a combination of base salaries, commissions, bonuses, and additional benefits. Their earnings are influenced by their ability to guide customers through the complex home-buying process, utilising their people skills and expertise in sales, customer service, or financial services.

For entry-level mortgage consultants, the average total compensation, including tips, bonus, and overtime pay, is approximately $36,107 per year. As consultants gain experience and move up the seniority ladder, their earning potential increases significantly. The average salary for a home mortgage consultant is estimated to be $163,042 per year, with the highest level of seniority commanding an annual salary of up to $380,788.

Mortgage consultants working for specific lenders, such as Wells Fargo, may earn salaries that are lower than the national average. For example, the average yearly pay for a Wells Fargo mortgage consultant is approximately $37,256, which is 36% below the national average. However, it's important to note that salaries can vary across different locations and employers, and Wells Fargo offers benefits such as matching 401K, health insurance, and flexible hours.

To enhance their career trajectory, mortgage consultants can focus on developing strong relationships with clients, gaining a deep understanding of the market, and staying updated with industry trends and regulations. Building a solid reputation for providing valuable guidance and exceptional service can lead to increased client referrals and a more successful career path.

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