Bookmark this guide for starting a career as a Mortgage Loan Officer

The mortgage loan industry is on a roll, thanks to the steady demand for housing and a growing real estate market in the U.S. 

If you are considering joining a thriving, stable, and lucrative profession, working as a mortgage loan officer might be the right career choice for you. 

Did you know that experienced mortgage loan officers (MLOs) can earn as much as $190K annually in the U.S. while making extra commissions and enjoying additional perks? 

It is no surprise that the number of job applicants for the role of a mortgage loan officer is increasing as the job role is currently amongst the top 15 best business jobs in the country. 

Moreover, the Bureau of Labor Statistics in the U.S. has predicted a steady increase of 3 percent in the total number of job openings for loan officers in the upcoming decade. 

This means that working as a loan officer can give you the opportunity to create the professional career of your dreams. 

Especially if you are someone who values a high-paying, six-figure salary without compromising on achieving a healthy work-life balance. 

Now before you get all too excited to start a career, it is important to take a pause and understand what it takes to become a mortgage loan officer in the U.S. 

Firstly, you must complete the mandatory education and fulfill all the qualifying requirements to become eligible for applying for an MLO license. 

Secondly, you must earn your NMLS MLO license from your respective state authority to start working in the mortgage lending industry. 

If this sounds confusing or overwhelming to you, keep on reading this in-depth guide to get answers to all your questions in detail. 

This guide will cover all the aspects of how to become a mortgage loan officer - from completing the MLO pre-licensing education to applying for an NMLS license, you will learn about it all in this article. 

Let’s start with the absolute basics first and understand what to expect in the career you want to pursue and prepare for. 

Who is a Mortgage Loan Officer

A mortgage loan officer is a licensed professional who has completed a minimum level of qualifying education and earned a NMLS approved license. 

Since mortgage loan officers deal with the financial and personal information of their clients, they are required by the law to complete minimum qualifying education and acquire a license.

It is a regulatory requirement that is applicable to all aspiring professionals in every state of the country.

MLOs work with individuals and companies who are prospective clients and help them apply for and secure the right mortgage financing plan. 

Loan officers are sometimes also referred to as loan originators and they work with financial institutions, banks, and credit unions to provide mortgage loans to borrowers.

It is important to note that you might also come across job postings for mortgage brokers which might seem a bit confusing. 

Just like mortgage loan officers, mortgage brokers also perform the task of assisting clients in securing loans for purchasing a property. 

However, unlike MLOs, mortgage brokers are independent professionals who are generally self-employed. 

In the larger context, MLOs can be used as an umbrella term to refer to a loan originator like a bank, credit company, or a licensed professional. 

What is the job of a Mortgage Loan Officer

The lending and finance industry is a dynamic, ever-evolving field that requires professionals to stay on top of emerging technologies, evolving consumer needs and updated regulations. 

This is why completing a mortgage pre-licensing course is a must if you want to work with clients and help them secure loans for their needs and use cases. 

However, before we get into the details of qualifying education for MLOs, it is important to understand what exactly you will do with the education. 

The lending and finance industry is a dynamic field that requires professionals to stay on top of emerging technologies, evolving consumer needs, and updated regulations. 

Here are some of the key job duties and responsibilities of a mortgage loan officer: 

• You will meet with potential clients and interview them to understand their needs, requirements, and preferences
• You will gather all the required information and collect all the important documents such as financial reports, credit history, income proofs, and tax statements.
• You will determine the loan eligibility of a potential client on the basis of their financial health, current income, credit score, and overall worthiness. 
• You will educate the clients about the various mortgage plans, interest rates, payment terms, and other options based on their needs
• You will suggest the most suitable and feasible mortgage financing plan, product, or service to fit the client’s needs and budget. 
• You will guide the client in filling out the loan application accurately and avoiding any potential errors or oversights. 
• You will work on behalf of your clients to negotiate the best interest rates and payment terms. 
• You will be the single point of contact for answering all your clients’ queries and resolving any issues or hurdles they might face. 
• You will liaise with underwriters, loan officers, brokers, and home appraisers to ensure the loan application is duly approved and processed. 
• You will navigate the client through various stages of applying for a mortgage loan. 
• You will ensure the loan application and submitted paperwork are fully compliant with the industry laws and state and federal regulations for NMLS professionals.
• You will file all important paperwork and keep the documentation handy for future reference on behalf of your employer. 
• You will check in with your clients post-completion of the application and disbursal of the loan amount to check if they are comfortable with their experience. 

As you might have figured out by now, the job profile of a mortgage loan officer in the U.S. requires juggling multiple tasks. 

There will never be a dull day in your life as a loan officer, as you will be meeting with clients, working with industry professionals, attending networking events, and even supervising junior officers as you gain experience. 

Next, let us walk you through the qualifying requirements and the steps involved in getting your MLO license in the U.S. 

The need for a MLO license for working in the industry

In order to start working in the mortgage and lending industry, you will need to first earn a mortgage loan originator license. 

A mortgage loan originator license is a legal tender that works as proof that you have fulfilled the minimum qualifying education and licensing requirements established by the NMLS. 

The NMLS stands for Nationwide Multistate Licensing System and Registry which is the leading authority for regulating the licensing and working of mortgage and banking professionals, firms, and institutions. 

Getting an NMLS-approved MLO license is mandatory to be legally able to work with lenders and borrowers and engage in a financial transaction anywhere in the country. 

An MLO license is required by loan officers, mortgage brokers, loan originators, and loan processors in the country. 

The license can only be earned after you fulfill the minimum eligibility criteria, complete the educational requirements, and clear the SAFE MLO national test for loan officers. 

What are the benefits of having an MLO license

Getting a license might seem like a daunting task but it is certainly worth the time and effort, especially if you wish to build a thriving career in the long run. 

As an aspiring mortgage loan officer, you might wonder what are the benefits of getting a license and whether it is necessary or not. 

The short answer is - yes, getting an NMLS MLO license is mandatory and completely necessary if you want to be legally able to work with individuals and companies in the U.S. 

In addition to meeting the compliance regulations, there are additional benefits of getting your MLO license. Some of these include: 

• Higher earning potential: Having an MLO license will make sure you are able to partake in any and every opportunity that comes your way. 

Since clients only want to work with licensed professionals, you will be able to tap into more opportunities and turn them into income and commissions. 

• More credibility: An MLO license is not only a testament to your education, knowledge, and professional abilities, but it is also proof of your commitment to your career. 

A license works as a badge of credibility in the industry and the more credible you are, the more interactions, leads, and business opportunities you can generate.

• Better career opportunities: The simple fact is banks, financial institutions, and credit unions are only looking for licensed professionals to work with. 

Since employers want to ensure compliance and maintain regulatory standards, it is a must to obtain your MLO license if you want to tap into the job market. 

Steps to obtain a mortgage loan officer license

Let’s talk in detail about how you can obtain your license to practice as a mortgage loan officer in the U.S. 

Irrespective of which state you belong from, listed below are the steps involved in the licensing process which are pretty much standard across all states. 

Step 1: Create your NMLS account

The NMLS is the official system through which applicants are required to apply for an MLO license and manage and renew their license. 

The first step is to visit the NMLS website and register yourself as an applicant. You will have to submit your personal information and fill in the required details. 

Upon completing, you shall receive a unique NMLS identification number and your credentials. 

Step 2: Complete NMLS pre-licensing education

As per the NMLS, all applicants must complete 20 hours of Mortgage Loan Originator SAFE course to qualify for a license. 

Students will learn about topics such as - mortgage regulations, fair trade, ethics, and consumer rights protection among others. 

Note that some states also require completing additional course hours for learning state-specific laws and regulations. 

You are free to choose between an in-person, classroom course or a virtual, online course to complete the education. 

Depending on your state, you can search for the best mortgage loan originator course to get started with your education. 

However, you must only learn from an NMLS-approved education provider to validate your course credentials. 

Step 3: Pass the SAFE MLO exam

After you have picked and completed the best MLO online course you can find, the next step is to prove your understanding and knowledge of the course topics. 

To do so, you must take the SAFE MLO licensing test and give your best attempt to score at least 70 percent or above if you want to pass the test. 

Once you have successfully cleared the MLO licensing test, you can apply for an MLO license. 

You can apply online by visiting the NMLS website and submitting proof of your pre-licensing education and proof that you have passed the test.