LoanOfficerTraining – Employment Contract Issues

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17-1/2 Contract Issues to Watch Out For When Negotiating an Employment Contract

Are you thinking about changing companies?

Or, maybe your company is asking you to sign an updated contract?

Contracts are not set in stone – they are negotiable.

So, even if you have an employment contract now, I suggest that you review it. If some of the 18 things I’m about to list are not covered or are unclear, you might want to get them clarified right now — before it’s too late!

  1. What happens to your pipeline if you quit? What happens to your pipeline if you get fired?
  2. What happens to loans if you are disabled or must take a leave of absence?
  3. What happens to the leads (not a loan app yet) if you leave the company?
  4. What is the company policy on internet and social media marketing?
  5. Who owns the database if you quit or are fired from the company?
  6. What is the company’s privacy policy regarding what “client information” you can include in your personal database?
  7. When do commissions get paid while you are employed?
  8. What are the reasons you would NOT get paid a commission on a file?
  9. What is the commission policy if a loan closes after you leave the company?
  10. Is there a non-compete clause?
  11. Will you be allowed to talk with processors and underwriters?
  12. What are the reasons or violations you could get fired for?
  13. If you violate the rules and regulations, what is the commission policy?
  14. Who is responsible for paying for marketing and promotions?
  15. Does the company have the right to make changes to a written contract without notice?
  16. Does the company require you to pay back commissions (or portions of commissions) and for what reasons?
  17. When signing an updated contract, watch for clauses that have been “removed” from the original contract.

Just a couple of tips:

  • Have an attorney also review the contract.
  • Compare the old contract with the new contract.

The bottom Line: If the contract is not clear to you, or not specific enough, keep working on the wording until it’s perfectly clear to anyone reading it. If your mother doesn’t know what it means, neither will a court of law.