A Comprehensive Guide to Becoming a Mortgage Broker in New York

By Ciprian Morariu Published: April 30, 2024

Becoming a Mortgage Broker in New York

Are you seeking a career that offers a mix of financial independence and job satisfaction? If yes, then working as a mortgage broker can be a good career opportunity for you. 

A licensed professional mortgage broker helps buyers secure loans for purchasing houses, assisting them to realize their homeownership dreams. 

Whether you want to work in the financial side of the real estate industry or wish to start your own mortgage brokership someday, starting a career as a mortgage broker in New York is a great first step. 

Did you know that as a mortgage broker working in New York, you can make around $100K in average salary annually? 

To work as a mortgage broker in New York, aspiring candidates must first get a mortgage loan originator/officer’s license.  

In this article, we are going to give you an in-depth understanding of the job role and responsibilities of a mortgage broker. 

Since mortgage brokers have to work with financial institutions and real estate professionals, they must keep themselves informed and updated regarding the latest laws and regulations. 

Plus, we will also share details on how to advance your career as a mortgage broker and what qualities to develop to stand out from the competition. 

What are the Functions of a Mortgage Broker

What Does a Mortgage Broker Do?

A licensed professional mortgage broker works for lenders assisting home buyers to secure mortgage loans. 

Mortgage brokers act as intermediaries between the two parties i.e. lenders and borrowers and help them connect to meet their needs. 

Since the dawn of real estate, home buyers have relied on the services of loan providers or lenders to complete their home ownership dreams. 

A mortgage broker must work together with a loan provider and home buyer and help those two parties strike a deal. 

As a mortgage broker, your day-to-day responsibilities will include: 

  • Forming professional relationships with financial institutions, banks and lenders.
  • Helping borrowers navigate through the different steps of finding mortgage loan options.
  • Collecting information, paperwork, and documents related to the credit and financial history of a borrower.
  • Helping borrowers to correctly file the mortgage loan application. 
  • Providing different types of mortgage loan options to borrowers to meet their needs.
  • Applying for suitable mortgage loan products and services on behalf of borrowers.
  • Advising borrowers on the different loan products, terms and conditions, and other important details.
  • Working with mortgage officers, title companies, and financial institutions throughout the mortgage lending process. 

Many aspiring mortgage brokers often face a common question - what exactly is the difference between a mortgage broker and a 76 mortgage loan officer? 

Broadly speaking, both loan officers and mortgage brokers share many common job responsibilities and duties. 

The Importance of a Mortgage Broker in New York

Before you start working towards getting a mortgage broker license in New York, it is important to understand the role and impact of working as one in a real estate transaction. 

For most people, buying a home is one of the most important financial and emotional decisions of their lives. 

As a mortgage broker, you will assist your clients achieve their home ownership dreams by helping them make the right financial decisions. 

Your financial knowledge and industry acumen will help your clients choose from a range of mortgage products and options. 

Mortgage brokers guide their clients in understanding the pros and cons of different mortgage options and suggest the most suitable option to meet their clients’ needs. 

Let us look at some of the reasons why mortgage brokers have an important role to play in the real estate industry: 

  1. Mortgage brokers are useful for home buyers who are buying a property for the first time and do not have the knowledge and understanding of how mortgage loans work. First time 
  2. Mortgage brokers help their clients save time and effort by helping them evaluate multiple loan options and products quickly and easily without going through the effort of manually searching for options. 
  3. Mortgage brokers act as a bridge between borrowers and lending institutions. This gives borrowers a wider range of options to choose from.
  4. Mortgage brokers provide sound, easy-to-understand financial advice and investment tips to borrowers who often are left perplexed due to changing investment rates, loan payment terms, and mortgage deals. 

Requirements for Obtaining a Mortgage Broker License in New York

Essential Education and Experience Requirements

Now that we have discussed what a mortgage broker does and their importance in the real estate industry, let us learn about how to get a New York mortgage broker license

First and foremost, every applicant must meet the basic eligibility requirements as established by the National Mortgage Licensing System (NMLS). These are as follows:

  • You must be 18 years of age or older
  • You must be a legal resident of the United States or a lawfully admitted alien
  • You must have a high school diploma or equivalent in education

In many cases, having a bachelor's degree in finance, accounting, and related fields can also help you meet the education requirements and expand your job opportunities. 

The NMLS sets all the mandatory requirements and criteria to apply, renew, and update a mortgage broker’s license. 

If you meet the statutory eligibility requirements, you will be required to fulfill the NY state education requirements. 

This requires every aspiring mortgage broker to complete the mandatory 20 hours of pre-licensing education from an NMLS SAFE and approved course provider.  

During this course, you will learn about the fundamentals of real estate laws, at both the state and federal level. You will also be introduced to mortgage origination, mortgage loan terms and types, and broker ethics. 

The course curriculum must include 3 hours of coursework specific to New York State in addition to other topics and courses as required by the NMLS. 

Completing this course is mandatory for all applicants and you can enroll in a state-approved and accredited college or course provider to do so. 

It is recommended that you visit the official National Mortgage Licensing System (NMLS) website to keep yourself updated about the course curriculum and duration. 

Once you have completed the pre-licensure education, you will become eligible to apply for the NY state licensing exam. 

The licensing exam, also known as the SAFE Act Mortgage Loan Originator test, is used to evaluate your preparation and knowledge of the industry and its underlying laws, regulations, and principles. 

Taking and clearing the test is mandatory for obtaining your licensure and ensuring compliance with state and federal regulations. 

The SAFE Act mortgage licensing test comprises 120 questions in total and you will get 190 minutes to complete the test. The test will assess your knowledge and skills of both New York (State) and National components related to mortgage lending and financial concepts. 

You must score at least 75 percent or higher to pass the SAFE test. 

Note that you will have to pay a one-time fee of $110 to take the test. You can schedule the SAFE test online by visiting the official website of the NMLS. 

Understanding the Licensing Process

Once you have successfully cleared the SAFE test, you will become eligible to apply for a mortgage broker license in New York

Here’s a quick refresher on the different steps required to complete the mortgage broker’s licensing process in NY: 

Step 1: Register on the NMLS website

Every applicant is required to register themselves on the NMLS website and request an account. 

Step 2: Obtain your unique NMLS ID 

Once you have created your account, you will receive a personal NMLS number which will be unique to you. 

Step 3: Complete the pre-licensing education

Getting NY state’s mortgage broker license requires the completion of mandatory pre-licensing coursework of 20 hours. 

Step 4: Take and clear the SAFE test

After completing the New York pre-licensing coursework, you can appear for the SAFE test. To obtain your licensure, you must clear the exam by scoring at least 75 percent or above. 

Step 5: Complete background verification

Once you have successfully cleared your SAFE Act Mortgage Loan Originator test, you can complete the background check and identity verification through the NMLS website. You will be required to submit your digital fingerprints as part of the procedure. 

Step 6: Submit your license application

As the final step towards becoming a licensed mortgage broker in NY, you must complete and submit your application. 

You will need to submit an individual MU4 form along with the application, background check documents, and required proof of certification. 

Step 7: Find a sponsoring broker

As per state law, every newly licensed mortgage broker must find a sponsoring broker or an experienced mortgage lender as a sponsor. 

This step is mandatory and must be completed to activate your license. 

Costs Associated with Acquiring a Mortgage Broker License

Let us look at the total cost required to become a licensed mortgage broker in New York and start your career. 

Firstly, you must pay the application fee of $379 to the NMLS to start the licensing process. 

This fee includes the one-time cost of $254 as license fees along with $125 as a background verification fee. 

Additionally, you will have to pay a $15 fee to obtain and submit your credit report. 

Finally, you will have to factor in the cost of completing your pre-licensing education required for obtaining an NY loan officer license. 

Generally, the education costs associated with a mortgage broker’s license preparation course are between $250 to $600 depending on the education provider, the package, and the features.

The education costs will also vary based on the content delivery methods i.e. whether you opt for in-person classes or online courses.