Becoming a licensed mortgage loan officer is easier than you think
Are you looking for an exciting and rewarding career path where opportunities for growth and promotion are abundant?
Working as a mortgage loan officer can be a good profession for you if you seek a six-figure income with a flexible work-life balance and want to help people.
Mortgage loan officers are skilled professionals who are usually the go-to people for borrowers seeking mortgage financing for buying a new home or refinancing an existing one.
The job outlook for licensed loan officers is promising and the Bureau of Labor Statistics in the U.S. has estimated that there will be a growing demand for professionals in coming years.
If you are looking for a stable, well-paying career where you can put your skills of finance, accounting, and business acumen to use, consider working as a mortgage loan originator.
As a loan originator, you will be the person responsible for working on behalf of lenders to assist borrowers in completing a loan application and navigating through the various stages.
You would be surprised to learn that the top loan officers in the U.S. can make as much as $150K annually while enjoying a flexible work schedule.
Depending on where you live, your income prospects might vary. However, a career as a mortgage loan officer can be financially lucrative and prosperous if you put in the effort.
The best part about starting a career as a loan officer is that you need not spend years to qualify for the job.
All you need is a mortgage loan originator license and you will be on your way to work with clients and earn commission on every deal you close.
If you are curious to explore the possibilities and opportunities that can open up in the mortgage lending industry, we have put together this in-depth article for you.
This article will educate you on how to approach the career path of a loan officer in the U.S. and what type of education and license it takes to become a professional in this industry.
Plus, we will also share details about what the job role of a loan officer entails and what are some of the key skills you must cultivate to succeed as a loan originator.
What exactly does a mortgage loan originator do?
Whether you want to pursue a career as a part-time or a full-time mortgage loan officer, it is important to understand the job profile and the key responsibilities it entails.
Loan originators (sometimes referred to as loan officers), work on behalf of financial institutions such as banks, private lenders, and mortgage and credit providers.
As a mortgage loan officer, you will be in charge of working with borrowers and individuals and helping them with loan paperwork, documentation, and application process.
You will act as a bridge between lenders and borrowers and act as the single point of contact for both parties as and when required.
Now, working as a loan originator requires you to do more than just sign and push papers - the role covers administrative, marketing, finance, and customer service-oriented duties.
Although your day-to-day job responsibilities will vary depending on your employer and experience, you can expect to perform a range of multiple tasks and duties such as:
- Acting as an intermediary between mortgage lenders and borrowers
- Providing financial advice and guidance to borrowers seeking loans
- Qualifying and processing mortgage loan applications for clients
- Evaluating the credit history, taxes and analysing various financial documents
- Determining the creditworthiness and financial health of borrowers
- Educating borrowers about mortgage plans, interest rates, and payment terms
- Guiding clients in choosing the most suitable mortgage to meet their needs
- Validating the credibility of the documents and details submitted by clients
- Managing the paperwork and documentation required to get a mortgage
- Updating all the details and records related to a loan application
- Keeping track of the latest industry developments, regulations, and best practices
From assessing your client’s needs and requirements to guiding them through the various stages of getting a mortgage, loan officers ensure a smooth and seamless experience.
Since the mortgage process requires multiple steps at different stages of the journey, you are expected to possess strong communication and interpersonal skills to work with clients.
Successful loan officers are good at written and verbal communication and have a strong sense of persuasion and sales.
Additionally, you must learn how to manage your time effectively and keep things organized as you will be dealing with a lot of important information and moving pieces at work.
Having a strong financial acumen and knowledge of accounting and lending is a must to be a good loan originator and provide value to your employer as well as your clients.
Becoming a mortgage loan officer requires a minimum level of qualifying education and training so you can prepare yourself for what the job role requires.
This is why completing a mortgage loan originator course is essential for ensuring you are equipped with the knowledge and skills.
Basic MLO licensing requirements
Becoming a professional mortgage loan originator in the U.S. requires you to earn an MLO license from your state.
Before that, you need to ensure that you meet the minimum licensing requirements to qualify for a career in the mortgage lending industry as a loan officer.
In the U.S., it is the duty and authority of the NMLS (Nationwide Multistate Licensing System) to issue and renew the licenses of professionals.
As per the NMLS, every applicant must meet the minimum statutory requirements which are:
- You must be an adult of at least 18 years or older of age
- You must have a high school diploma in education or a GED equivalent
- You must be a legal resident of the U.S. or a lawfully residing alien
Some employers might require applicants to hold a bachelor’s degree in finance, business administration, accounting, or a related field.
The next step is to register with the NMLS by creating your account and getting your unique NMLS identification number and password.
Educational Requirements for an MLO License
Aspiring loan officers are required to complete mandatory education to prove their eligibility for an MLO license.
As per the NMLS education guidelines, you must complete a minimum of 20 hours of NMLS-approved education to qualify for a license.
Completing pre-licensing education is an essential and crucial step in your licensing journey if you want to work as a legal, licensed loan originator in the U.S.
Here are some of the courses you can expect to cover during your pre-license education:
- Mortgage origination (20 hours)
- Federal law and regulations (3 hours)
- Ethics and associated fields (3 hours)
- Lending standards (2 hours)
The purpose of pre-licensing education is to equip you with the required knowledge of the fundamentals of the mortgage lending industry and the various state and federal laws.
Like any other profession, education is the foundation upon which a successful, lasting career is built. Thus, you must take your MLO license education program seriously.
When it comes to completing your education, you can choose to join an in-person classroom-based college or enroll in an online MLO license course based on your preferences.
Many students prefer the flexibility and convenience of online courses as they can be completed from anywhere on any device.
Irrespective of your preferred learning medium, it is a must to choose an NMLS-approved education provider to ensure you are learning from certified instructors and curriculum.
Since different states might have specific educational requirements for aspiring loan originators, it is recommended to check the latest requirements from the NMLS portal.
Examination Requirements To Become An MLO
After you have successfully completed the mandatory pre-licensing education requirements, the next step is to take the SAFE MLO licensing exam in your state.
To obtain your MLO license, you must take and pass the national licensing exam which is a mandatory requirement for all applicants.
There are many exam prep courses and training packages offered by education providers that you can use to prepare and get familiar with the type of questions you can expect.
Remember that you need to score at least 75 percent or above to pass the SAFE licensing exam in your state.
Additional requirements for getting a MLO license
Once you have completed your education and passed the MLO licensing exam, you will be just a few days away from becoming a licensed professional.
One of the important steps in your licensing journey is to fulfill the criminal verification and background history check to prove good moral character and meet the minimum standards of ethics and trustworthiness.
Under the SAFE Act, you are required to submit an electronic scan of your fingerprints for background verification and a criminal history check.
Additionally, some states might also require applicants to submit the latest credit report for verification and authenticity purposes.
Lastly, once you obtain your MLO license in your state, you need to find employer sponsorship to activate your license.
The NMLS requires every newly licensed professional to work under a licensed, experienced employer such as a mortgage company, and gain practical experience for a few years.
To activate your MLO license, you need to submit your employer sponsorship details using the NMLS portal and your NMLS identification number.
Advantages of a career as a loan originator
Now that you have learned about the steps to get your MLO license and start your career, you might be wondering whether the career path is right for you or not.
When it comes to the time required to obtain your license, it generally depends on the student and their learning pace and progress.
However, it usually takes anywhere between 45 to 60 days to complete your education and take the SAFE MLO licensing exam in your state.
Imagine earning a comfortable pay package and enjoying professional growth opportunities by spending only a few months of your life.
Mortgage loan officers are highly sought-after in the industry, thanks to the growing demand for residential real estate and housing in the country.
After you work in the industry for a few years, you can progress to work as the manager of a financial institution such as a bank, credit company, or private lender.
For those who have an entrepreneurial spirit, you can also work independently as a consultant and offer your specialized services to clients.
A career as a licensed loan originator is a financially rewarding and emotionally satisfying career path for anyone who is good with numbers and people.
The mortgage lending industry offers good pay, a stable job, and a clear path for professional growth and networking for you to advance in your career.