Complete Info On Mortgage Loan Originator and MLO License Texas

Are you an aspiring Mortgage Loan Originator (MLO) in Texas wanting an MLO license to launch a very successful and lucrative career? In that case, this post is right for you as it explores several aspects to become an MLO, from the responsibilities to getting a mortgage loan originator license in Texas, and other related information.

Who Is A Mortgage Loan Originator

A Mortgage Loan Originator (MLO), often titled a Mortgage Loan Officer (MLO), is a financial professional who helps potential homebuyers get mortgage loans to buy their dream properties.

MLOs lend a hand to client throughout their journey to acquire property, from the mortgage approval process at the start of their loan application till such time as the deal is finally closed.

MLOs also advise clients on the different types of mortgage loans available with lenders and the one that will suit them the best. In short, anybody with a mortgage loan originator license in Texas acts as a bridge between a borrower and a lender.

They collect all necessary financial documents required for loan sanction, process them, and present them to the lenders for disbursement. MLOs per se do not have any loan sanctioning powers.

Even though loan originators and loan officers are talked about in the same breath, there is a subtle distinction between the two.

Mortgage Loan Originators are typically associated with mortgage companies. A mortgage loan officer starts the loan procedure, a processor analyzes the application, and an underwriter sanctions the loan in-house.

On the other hand, a mortgage loan officer works for a single mortgage company or a financial institution, such as a local bank or local offices of a national mortgage company.

Let’s now go through the various steps to get a mortgage originator license Texas and kickstart a very lucrative career.

How To Get A Mortgage Originator License Texas

The Nationwide Mortgage Licensing System (NMLS) is the controlling body for the mortgage industry in the USA and is responsible for issuing and renewing MLO licenses. It also fixes guidelines about how to get a Mortgage Loan Originator license in Texas.   

Here are the steps to get a mortgage loan officer license texas.

Step 1: Completing basic requirements

Before starting on the journey to get a mortgage license texas, certain basic requirements must be met.

Most critical is that you must be at least 18 years old to apply for a license. That does not stop you from going through the other steps to get a license, such as completing the pre-licensing coursework. The rule is that you must have crossed this benchmark age on the date you apply for a license.

Next, you must be a citizen of the USA to get a mortgage loan license texas. Migrants from other countries may also apply for a mortgage license texas, provided they have been granted working rights in the country.

On the educational front, you should have a high school diploma or an equivalent, such as a GED, to apply for a license.

Once these three conditions are met, start the official process of earning a mortgage loan originator license in Texas. Visit the NMLS portal and create an account.

You will be issued an ID number, which will be your credential throughout your career as an MLO. Quote this number when you appear for the licensing exam and in all official correspondence with clients, NMLS, or others.

Step 2: Go through the pre-licensing coursework

The coursework to get a mortgage loan originator license in Texas consists of two parts.

The first is the 20-hour national section that covers the mortgage rules and regulations common throughout the USA. The following topics are covered in this part.

• Federal Law and Regulations (3 hours)
• Ethics, including fraud, consumer protection, and fair lending (3 hours)
• Standards for non-traditional mortgage products (2 hours)
• Miscellaneous instructions on mortgage origination (12 hours) 

The second part is the 3-hour coursework that is Texas-specific. Every state passes laws that are unique to the functioning of the mortgage industry within its boundaries. Texas is no exception, and this is what the 3-hour part consists of.

NMLS provides a lot of focus on completing the pre-licensing coursework as a path to appear for the SAFE licensing exam and be awarded a mortgage license  texas.

This is because the mortgage industry is a complex one with a lot of intricate rules governing it. If MLOs do not have a thorough understanding of them, they will not be able to offer optimized and precise services to their clients in the future.

• Broad areas covered in the pre-licensing courses are as follows. 
• Federal Mortgage-Related Laws:
• Uniform State Content
• General Mortgage Knowledge
• Mortgage Loan Origination Activities
• Ethics
• Others: Credit Analysis, Real Estate Investing, Mortgage Fraud, Consumer Protection, Fair Lending, and Closing Procedures.

Your ability to pass the SAFE licensing exam on the first try and not spend years on it depends largely on the quality of the coursework selected by you. A couple of points must be kept in mind when you invest in a course to get a mortgage loan license texas.

Ensure that the pre-licensing course selected by you is approved by NMLS. This is mandated, and any other course will not be counted as having met the 23-hour coursework eligibility norm to appear for the SAFE test.

It is advisable to visit the NMLS portal to check the list of approved course providers in Texas to make sure that your investment and time spent on study materials do not go to waste.

You must also select either an online pre-licensing course or a classroom-based one. Your choice depends on what is in your comfort zone and your preferred learning style. However, online courses offer flexibility and convenience not present in physical mortgage school courses.

Online course materials can be downloaded onto any Internet-enabled device, thereby offering the opportunity of studying from anywhere and at any time. On the other hand, you have to spend time and money commuting to physical courses, upsetting your normal routines. ]

For those with other jobs and only now looking for a new career as a mortgage loan officer in Texas, online courses are very suitable.

Among the top mortgage NMLS-approved online course providers in Texas is RealEstateU. Their courses are designed by top mortgage professionals in this field and therefore, of the highest quality while being among the most affordable in this niche.

What sets RealEstateU mortgage courses apart from others in the field is the mock tests and practice questions offered in high-end packages. The benefit here is that the mock tests have practice questions that replicate what you will face in the real licensing exam.

You can then know the format of the questions in the real test, thereby boosting your confidence to pass the tough exam on the first try.

Step 3: Submit a fingerprint scan for background verification

In Texas, you must submit your fingerprints electronically for a background check for past criminal records. This is essential as MLOs handle financial documents in their career and must therefore have high moral standards and financial integrity.

Fingerprint verification brings any adverse issues to the front, and it is later the discretion of the NMLS to either issue a mortgage loan originator license in Texas or not in case of a poor record.

The process of submitting fingerprints before applying for a mortgage originator license Texas is done through the NMLS to the Texas Department of Public Safety (DPS) and the FBI.

The detailed process is as follows:

Authorize the NMLS to conduct the criminal background check on their portal and pay the fee of $36.25 for both the FBI and DPS. 

Schedule a fingerprint scan through the NMLS website at a designated center through a live scan process. IndentoGO locations are commonly used for fingerprinting.

The electronic submission of fingerprints to NMLS is automatically processed, and the result is sent to the Texas Department of Savings and Mortgage Lending (SML) for review. If the FBI finds the fingerprints illegible, you will be asked to resubmit them. 

The fingerprints must be submitted for electronic scan within 180 days of authorizing the NMLS to do so.  

A clean background devoid of any issues is a crucial step in your journey to get a mortgage loan originator license Texas.  

Step 4: Schedule the SAFE licensing test

Visit the NMLS portal and schedule the SAFE licensing exam.

The Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) of 2008 mandated the NMLS and the SAFE MLO test to set benchmarks for issuing mortgage originator licenses in Texas to protect consumers from any fraudulent activities. Failing the exam is not uncommon, and candidates are offered the chance to appear for the exam again.

You must visit a physical test center to appear for the exam, though the test is held online.

Step 5: Appear for the SAFE test

Passing the SAFE MLO test is a statutory requirement to get a mortgage license texas, and all aspiring MLOs must complete this step. We have elaborated earlier in this post about the subjects that you will be tested on.

As a brief recap, they are loan origination activities, ethics, federal mortgage laws, general mortgage rules, and the mortgage laws related to Texas.

The questions of the SAFE test are in a multiple-choice format. The test consists of 120 questions, of which 110 are scored and 10 are unscored and must be completed in 190 minutes.

Since the test is held online, you are informed about the result in the center itself soon after it is over in a pass/fail format only, and not the actual marks. The pass score for the SAFE MLO test is 75%.

Step 6: Find employer sponsorship

To apply for a mortgage loan originator license in Texas, find a licensed broker or a lending company to sponsor you. This is necessary as you will gain first-hand and practical knowledge of the mortgage industry.

Additionally, you will get referrals from the mortgage broker to initially help you along with business contacts till such time as you get clients onboard on your own. You must provide your broker with access to your NMLS account.

Step 7: Application for mortgage originator license Texas

Once all the steps have been completed, visit the NMLS website and apply for a mortgage loan originator license in Texas. Complete the Individual Form (MU4), pay the license application fees through NMLS, and upload the required documents.

These include proof of completing the pre-licensing coursework, a fingerprint clearance certificate, and your current employment status with a licensed mortgage brokerage firm or a lending institution.

Once you complete all the requirements, a mortgage loan officer license texas will be issued to you either by the Texas Department of Savings and Mortgage Lending (SML) or the Office of Consumer Credit Commissioner (OCCC).

The License application fee depends on the type of license.

OCCC MLO licenses are required for those who take residential mortgage applications or negotiate loan terms for compensation in Texas. The license application fee here is $325.

SML MLO licenses are required for those who are involved only in residential mortgage lending in Texas. The license application fee here is $45.

Additional fees that are applicable in both cases are $100 new application fee (including $20 recovery fee) and a $70 license renewal fee.

Hence, the fee for a mortgage license texas ranges between $215 and $495. 

Summing Up

With a mortgage loan originator license in Texas, you have several career opportunities with good earnings. You have openings as a mortgage loan originator, a mortgage loan officer, a Senior Loan Officer, a Mortgage Loan Processor, a Loan Officer Assistant, and more.

The median salary of a mortgage loan originator in Texas is $74,369, though it varies between cities in the state. With a couple of years of experience under the belt, a six-figure income is a distinct possibility.

Overall, it pays to get a mortgage originator license Texas.