Guide to starting your career as a loan officer in California
Working as a loan officer in California can offer you a great entryway into a high-paying career where opportunities for growth and success are plenty.
Imagine the monetary satisfaction of earning a six-figure salary, working in a dynamic industry, and helping people achieve their homeownership goals.
Does this sound like a professional dream come true to you? If yes, then a career as a mortgage loan originator might just be the perfect fit for you.
Thanks to the rising demand for mortgage loans and financing due to the growing need for housing, loan officers are highly sought after in the industry.
In a popular and promising real estate market like California, the demand for residential real estate has consistently been strong.
Working in the mortgage lending and finance industry in CA means you can enjoy a professional career brimming with opportunities for earnings, commissions, and promotions.
Did you know that many mortgage loan originators in California can easily make between $150K and $200K after a few years of experience in the industry?
This career also allows professionals to enjoy a more flexible work-life balance, thanks to the hybrid and remote working jobs available for loan officers.
The best part is that you can achieve this professional goal without necessarily obtaining any specialized degree or education.
As long as you obtain your California MLO license, you can legally work as a loan officer anywhere and assist clients and borrowers.
Becoming a mortgage loan officer in California might seem like a daunting and challenging task but if you prepare well and meet the licensing requirements, it is certainly achievable.
If you are curious to learn more about how to become a mortgage loan originator in California, then we have put together this ultimate guide for aspiring professionals like you.
Ready to start an exciting, rewarding professional journey? Let’s give you a deep dive into the licensing requirements, costs involved, and other steps in becoming a loan officer.
What does a Mortgage Loan Officer do?
Before you embark on a new career, it is important to take a step back and understand what exactly is expected from you on the job.
Mortgage loan officers (sometimes interchangeably known as mortgage loan originators) are licensed professionals in charge of evaluating the creditworthiness of borrowers.
Loan officers are typically employed by financial institutions like banks and by private credit companies, lenders, and mortgage lenders.
Loan officers spend most of their time interacting with prospective and existing clients through phone, email, or in-person meetings. A typical work week will require you to commit around 40 hours or slightly more.
MLOs work with borrowers and help them find and choose the right type of mortgage plan. You will be responsible for guiding them through the different stages of getting a loan.
For most homebuyers, financing a house is one of the most important and crucial personal and financial decisions of their life.
To ease the process and make the right choices, they rely on the expertise and skills of mortgage loan officers.
You will be assisting consumers in making sound financial decisions based on their requirements and needs and helping clients achieve their homeownership goals.
Primarily, your job profile will entail a varied list of day-to-day tasks and duties which we will discuss in the next section below.
What are the job duties of a loan officer?
Before we dive deeper into understanding the CA MLO license requirements, let us give you an overview of your job duties and day-to-day responsibilities.
A day in the life of a MLO is never dull as there are always multiple and varied tasks to be completed.
You must prepare to juggle a range of responsibilities related to accounting, sales, customer service, and marketing to become a successful loan officer.
While your exact job responsibilities will depend on your employer’s discretion and needs, let’s take a look at some of the core job duties you are expected to perform.
- Qualifying prospective clients:
Loan officers are primarily responsible for interacting with potential clients and interviewing them to understand their mortgage needs and requirements.
You will be meeting borrowers who are interested in getting a mortgage and help them understand the different types, terms, and choices available in the market.
Be it a first-time homebuyer or a repeat client, it is important that you carefully understand their financial goals and plans to help them make sound financial decisions.
The objective of conducting meetings, interviews, and discussions with prospective clients is to evaluate their creditworthiness and financial status.
This is the stage where you gather their needs and requirements and profile them based on the data collected.
On the basis of credit history, income proofs, debts, and other financial information, you will be in a better position to guide and assist them.
- Completing the paperwork:
In order to obtain a mortgage from any credit provider, financial institution, or lender, it is important for borrowers to complete mandatory paperwork and documentation.
Since the mortgage lending and finance industry is heavily regulated and governed by policies and laws, it is critical to provide the paperwork required by state and federal authorities for approval and reference checks.
This is a crucial part of the mortgage buying journey and is often quite complicated, especially for first-time home buyers.
This is where you will come to their help as an experienced mortgage loan officer and guide your clients in completing the required paperwork.
This step must be completed in accordance with the standards and guidelines established by the lenders and financial institutions to avoid any penalties, fines, or rejection of loan applications.
- Providing mortgage plans:
Mortgage loan officers are skilled professionals who are entrusted by both lenders and borrowers to provide personalized and relevant mortgage options.
As a loan officer in California, your job duties will involve educating the clients about the various loan and financing options, payment terms, interest rates, and options.
Based on the needs of your clients and their creditworthiness, you will recommend the most suitable and feasible lending solutions to borrowers.
You will have to explain the various types of loans, their specific terms, pros and cons, and various other details to loan applicants and prospective clients.
Note that loan officers should not nudge or force their clients to choose a particular financing plan. Instead, you must enable your clients to make an informed financial decision.
- Provide timely updates:
Loan officers are the primary point of contact for all communication related to processing, updating, or rejecting a loan application.
You will be responsible for providing timely application status updates to your clients regarding every important milestone or key development.
Since loan officers often work and coordinate with other professionals such as underwriters, escrow officers, appraisers, management, and mortgage brokers, it is important to keep your clients in the loop.
In addition, you will also have to resolve consumer doubts, and queries or handle any complaints or concerns that they might face before, during, or after applying for a mortgage.
In addition to the above core job duties, you might have to perform additional tasks and associated actions to advance in your career as a mortgage loan officer.
Understanding the California Loan Officer Requirements
If you plan on getting a mortgage loan officer license in California, you must adhere to and fulfill all the state-specific licensing requirements and criteria.
In California, it is mandatory for aspiring loan officers to prove their eligibility by qualifying for the educational, background, and examination requirements.
Let us give you a step-by-step overview of what it takes to start working in California’s mortgage lending and finance industry as a loan officer/originator.
Step 1: Meet the basic eligibility requirements
Like most states, California has its own set of state-specific requirements for aspiring loan officers, originators, and mortgage brokers.
To qualify for a mortgage loan officer in California, you must first meet the statutory eligibility requirements. These are as follows:
- Applicants must be at least 18 years or older
- Applicants must be a legal resident of the United States or a lawfully residing alien
- Applicants must have a high school diploma in education or a GED equivalent
If you fulfill the above requirements, you should not face any problems in applying for the role of a mortgage loan officer.
Fulfilling the above requirements is a must if you want to start working in the finance and mortgage lending industry.
Additionally, it also helps to have a bachelor’s education in finance, accounting, or business administration as it can work in favor to boost your application and make you more employable in the mortgage lending industry.
Step 2: Register with the NMLS
California law requires all applicants to complete their registration with the NMLS (Nationwide Multistate Licensing System) to qualify for the job of a loan officer.
NMLS is the country’s leading authority for managing the licensure of all lending professionals, firms, and institutions across 50 states.
It works as a centralized repository that has accurate and updated information on every MLO in the country.
If you are seeking to become a MLO in California, you must first register with the NMLS by visiting their website and creating your profile.
Once you do this step, you will receive a unique NMLS identification number assigned to your profile.
This ID will be used throughout your career whenever you wish to update, renew, or resign your license.
Step 3: Complete MLO pre-licensing education
One of the most important California MLO license requirements is completing the mandatory qualifying education to prove your eligibility.
California follows the NMLS education standards for aspiring MLOs and as per the guidelines, you must complete 20 hours of pre-licensing education from an NMLS-approved education provider.
Completing SAFE (Secure and Fair Enforcement) approved course credits is a must to become eligible for taking the NMLS MLO licensing exam in California.
After completing the coursework, you can apply for the NMLS mortgage licensing exam which includes multiple choice questions based on your course curriculum.
It is mandatory to pass the licensing exam and to do so, you must score at least 75 percent or above in the final test.
Step 4: Complete background verification
To get your MLO license in CA, you must submit an electronic copy of your fingerprint scan along with the latest credit report to the California DBPR for review and approval.
Step 5: Find employer sponsorship
The NMLS guidelines require all newly licensed MLOs to work with a sponsoring employer licensed in the state of California.
Once you get your employer sponsorship details, you must submit them on the NMLS online portal using your unique identification number.