A wholesale mortgage account executive represents a lender that buys loans from mortgage brokers and bankers. After loans are funded, lenders either service them or sell them to secondary market investors. Before the banking crash of 2007 and 2008, there were thousands of account executives in the industry, most of who were employed by subprime lenders. While it was not uncommon for some account executives to earn $300,000 per year or more before the crash, the number of AEs in the industry has declined and the salaries they earn are significantly less in today's market.
A wholesale account executive operates much like an outside salesperson. His job is to form relationships with mortgage brokers and bankers who do not fund their own loans. The goal is to locate loan officers who originate mortgages that fall within the credit guidelines of the AE's lender. The typical account executive typically makes personal visits to his brokers and markets products by e-mail or phone. Most lenders require their AEs to have solid lending relationships with 10 to 20 clients.
Base Salary Plus Commission
Some account executives earn a base salary plus commission. Commissions are commonly paid as basis points (1/100th of a percentage point) on each loan funded, or the total volume of funded loans in a month. For example, if an AE is paid 25 basis points and he funds $1,000,000 in a month, he would receive $2,500 in commission in addition to his salary (1,000,000 x .25). Most salary plus commission compensation packages include base salaries in the $30,000 to $40,000 range and a tiered commission schedule starting at 25 to 35 basis points.
Some account executives, most notably those with established books of business, work on a commission-only basis. While this often includes a draw against commissions, this type of compensation plan usually comes with larger commission splits than those associated with base/plus plans. Account executives working on commission-only are commonly paid a minimum of 40 to 50 basis points. Commissions typically increase with funded loan volume.
Most lenders require wholesale account executives to produce a minimum amount of business each month. While loan sizes vary from market to market, most lenders require AEs to fund between $750,000 and $1,000,000 to be in good standing. New employees are usually given three to six months to establish their books of business before minimum requirements are enforced.
While loan sizes are larger in some parts of the county, resulting in account executives salaries reaching well into the six figures, the average salary for the position is considerably less. According to industry figures as of June 2011, the average salary for a wholesale mortgage account executive is $91,000. This includes AEs who work for lenders that fund conventional (Fannie Mae, Freddie Mac), government (FHA, VA) and subprime loans. Account executives who work in high-dollar areas such as Los Angeles, Chicago and New York City, typically earn the highest salaries. However, some of their pay is often offset by a higher cost of living.