How do I become a lending broker?

To become a mortgage broker, you obtain a state broker company license by filing through the Nationwide Multistate Licensing System (NMLS). You create an NMLS account, match your business activities to each state's license requirements using the NMLS Checklist Compiler, and file the Company Form (MU1) with Individual (MU2) forms for your control persons. States add their own requirements, such as a surety bond posted electronically through NMLS, a business plan, and fingerprints and credit reports for each control person.

In Alabama, a mortgage broker license is issued by the State Banking Department under the Mortgage Brokers Licensing Act. You file a written application under oath with a $600 nonrefundable fee, show a financial statement with $25,000 of tangible net worth or a surety bond set by the department, and show that at least one principal or executive officer has 2 years of mortgage industry experience within the previous 4 years. The department must grant or deny a completed application within 90 days.

To work as a lending broker in Arizona, you follow the state's loan originator licensing path: obtain a unique identifier through the Nationwide Multistate Licensing System (NMLS), complete 20 hours of approved pre-licensing education, pass the SAFE loan originator exam, submit fingerprints, and file the MU4 application. The Arizona Department of Insurance and Financial Institutions (DIFI) must grant or deny the license within 120 days of a completed application. Your sponsoring employer files written notice of hire before you begin originating loans.

California has two lending-broker tracks. You can qualify as a real estate broker through the Department of Real Estate (DRE), which requires eight college-level courses, two years of qualifying experience, and the broker exam, then add the mortgage loan originator (MLO) endorsement through NMLS. Or you can work under a company licensed by the Department of Financial Protection and Innovation (DFPI), which requires the 20-hour pre-licensing course, the SAFE MLO Test, and an MU4 application with company sponsorship.

In Colorado, a lending broker acting as a company is a "mortgage company," which must be registered on the Nationwide Multistate Licensing System and Registry (NMLS) and be in good standing with the Colorado Secretary of State. The company registration is separate from the individual mortgage loan originator (MLO) license you need if you personally take residential loan applications or negotiate loan terms. The NMLS company registration carries a $120 initial set-up fee.

To become a lending broker in Florida, you need the mortgage broker license, an entity license under Chapter 494 filed through the NMLS. You must designate a principal loan originator who has held a loan originator license for at least 1 year, or who can show at least 1 year of active mortgage business experience. Each control person must submit fingerprints for state and FBI criminal history checks and authorize an independent credit report, and the application carries a $425 nonrefundable fee. Licenses renew annually by December 31.

To lend mortgage money in Georgia, you apply for a Mortgage Lender License through the Nationwide Multistate Licensing System (NMLS) with the Georgia Department of Banking and Finance. The new application fee is $1,150 plus NMLS fees, which the state fee rule breaks down as a $900 license fee plus a $250 initial investigation fee, and each Georgia branch approval costs $330 plus NMLS fees. A broker that funds loans through warehouse lines is treated as a lender and must hold this license and carry the required electronic surety bond.

In Illinois, individual loan originators are licensed by the Illinois Department of Financial and Professional Regulation through NMLS. You must complete 20 hours of NMLS-approved pre-license education (3 hours federal law, 3 hours ethics, 2 hours non-traditional lending, 12 hours electives), pass the SAFE MLO Test with Uniform State Content, and file an MU4 application with fingerprints and a credit report. An Illinois residential mortgage licensee must then submit a sponsorship request before you can originate loans.

To become a lending broker in Kentucky, you apply through NMLS: submit the company form, individual forms for all control persons, an audited financial statement (or a startup statement of condition), certified organizational documents, and a Kentucky Secretary of State Certificate of Authority dated within 60 days. You must also post a surety bond of at least $50,000 and pay the $1,000 state license fee, which covers all branch locations. Renewal applications are due by November 30 each year.

In Michigan, an individual who brokers mortgage loans must hold a mortgage loan originator (MLO) license from the Department of Insurance and Financial Services. You must complete 20 hours of NMLS-approved pre-licensure education including 2 hours of Michigan content, pass the SAFE test, and apply through NMLS with employer sponsorship, a surety bond, and fingerprint and credit checks. Company-side broker licenses fall under the Mortgage Brokers, Lenders, and Servicers Licensing Act, and a company license alone does not authorize an individual to originate loans.

In Missouri, a mortgage lending broker (company) needs a residential mortgage loan broker license from the Division of Finance. The company must maintain a full-service office in Missouri that is open to the public, post a surety bond of at least $50,000, pay a $300 application and investigation fee plus a $600 annual license fee, and pass background and credit checks on owners and managers. Applications are submitted through the Nationwide Multistate Licensing System (NMLS).

A lending broker in Nebraska is licensed as a Mortgage Loan Originator by the Nebraska Department of Banking and Finance. You complete 22 hours of NMLS-approved pre-licensing education, including 2 hours of Nebraska law, pass the SAFE test National Component with Uniform State Test content, and file an MU4 application through NMLS with a $150 state fee. The application includes a criminal background check, a credit report, and sponsorship from a licensed mortgage banker or installment loan company.

In New York, a mortgage broker registers with the state Department of Financial Services (DFS) through the Nationwide Multistate Licensing System (NMLS), paying a $1,500 application fee. The applicant must have, or employ, a qualifying individual with two years of verifiable credit analysis or underwriting experience, and must file a surety bond of $10,000 to $100,000 based on loan volume. Registered brokers place loans with licensed mortgage bankers or exempt organizations; they cannot make loans themselves.

To become a mortgage broker in North Carolina, you apply through NMLS to the North Carolina Office of the Commissioner of Banks. The company pays a $1,250 application fee, files a surety bond of at least $75,000 (adjusted each year by loan origination volume), and designates a qualifying individual with at least 3 years of residential mortgage lending experience. If the broker has no branch offices, the qualifying individual must also hold a mortgage loan originator license, which requires 24 hours of approved education, a passed SAFE test, and background and credit checks.

To become a licensed loan originator in Ohio, create an NMLS account, complete at least 24 hours of NMLS-approved pre-licensure education (including 4 hours of Ohio law), and pass the SAFE MLO test. Then submit the MU4 application with fingerprints for an FBI background check, a credit report authorization, and a sponsorship request from your employer. Your NMLS license status must show "Approved" before you may originate loans.

A mortgage broker in South Carolina is licensed by the South Carolina Department of Consumer Affairs through NMLS. You need at least 3 years of experience in financial services, or 3 years with a federally insured depository institution or a VA/FHA/HUD-approved mortgagee, and qualifying college coursework can substitute for 1 year. You must post a surety bond of at least $25,000, pay the $550 initial license fee plus a one-time $200 processing fee, and hold a branch license ($150 each) for any office beyond the main location.

To broker residential mortgage loans in Virginia, you can either license your own company as a mortgage broker under Chapter 16 or become a mortgage loan originator working for a licensed lender or broker. The company license requires an application to the State Corporation Commission's Bureau of Financial Institutions, accompanied by a surety bond of at least $25,000 that is continuously maintained. The individual mortgage loan originator license requires 20 hours of approved education, the SAFE test, and a background and credit review.