How do I become a mortgage loan processor?

A mortgage loan processor assembles and verifies borrower documents and prepares loan files for underwriting. Federal law does not require a license for a supervised processor who works at the direction of a licensed loan originator and does not hold themselves out to the public. An independent-contractor processor or underwriter must instead be a state-licensed loan originator.

As a supervised employee of a licensed mortgage company, a loan processor needs no separate license, because supervised employee processors are excluded from Alabama's mortgage loan originator definition. An independent-contractor processor must instead obtain an MLO license, which requires 20 hours of NMLS-approved pre-licensing education, a passing SAFE test score of at least 75%, and an MU4 filing with fingerprints for an FBI background check and a credit report authorization. Alabama requires no prior industry experience for the individual MLO license.

A mortgage loan processor assembles and verifies home loan application paperwork before the underwriter reviews it. In Alaska, a processor who works as an independent contractor must hold the mortgage loan originator license, which requires 20 hours of NMLS-approved pre-licensure education, the National Test Component with Uniform State Content, and sponsorship from an Alaska-licensed Mortgage Broker/Lender.

A loan processor in Arkansas needs no license when the work stays administrative. The rules define clerical and administrative tasks to include the receipt, collection, and distribution of information used in processing or underwriting a mortgage loan, so long as the processor does not solicit or accept applications or negotiate loan terms. Working within those limits for a licensed mortgage broker or mortgage banker requires no license, but soliciting, negotiating, or offering loan modifications requires a loan officer license.

It depends on how you work. A loan processor who is an employee performing purely administrative or clerical tasks does not need a Mortgage Loan Originator (MLO) endorsement. An independent-contractor loan processor or underwriter, however, must hold a real estate broker license with an MLO endorsement under Business and Professions Code 10166.03.

In Colorado, a loan processor needs a license only if working as an independent contractor. Employees who process loans under the direction of a licensed individual, and who do not represent to the public that they perform mortgage loan originator activities, are exempt under section 12-10-709, Colorado Revised Statutes. Independent contractors (1099 employees) performing third-party loan processing must hold the individual mortgage loan originator license.

Connecticut requires loan processors to hold a loan processor or underwriter license issued by the Department of Banking. You complete 21 hours of NMLS-approved prelicensing education (including 1 hour of Connecticut law), pass the SAFE test, and file the MU4 through NMLS with the required background check and credit report authorization. Employees of a licensed lender or broker who work at the direction of, and under the supervision of, a licensed mortgage loan originator are exempt from the license.

The answer depends on your employment arrangement. An independent contractor loan processor must obtain a Delaware MLO license before conducting business involving residential mortgage loans on Delaware properties, which means completing 20 hours of prelicensing education, passing the SAFE test, and filing form MU4 through NMLS. A processor who is an employee working at the direction and under the supervision of a licensed lender or mortgage loan broker (Title 5 Chapter 21 or 22 licensee) does not need an individual license.

The path in DC depends on your role. As an independent contractor loan processor, you must hold a DC MLO license, which means completing 20 hours of NMLS-approved pre-licensing education, passing the SAFE MLO Test with a score of 75% or better, and filing an MU4 application through NMLS. If you work solely as a processor and never hold yourself out to the public as able to perform loan originator activities, no license is required under D.C. Code § 26-1103.

Florida recognizes two processor paths. As an in-house loan processor, you work as an employee of a single mortgage broker or lender and must work under the supervision of a licensed loan originator. As a contract loan processor who serves more than one broker or lender, you must hold a loan originator license and file Form OFR-494-13, the Declaration of Intent to Engage Solely in Loan Processing, with the Office of Financial Regulation.

In Georgia, loan processors are required to hold a Mortgage Broker/Processor License unless otherwise exempt, and the application is filed through the Nationwide Multistate Licensing System (NMLS). The new application fee is $650 plus NMLS fees, and the licensee must maintain a minimum tangible net worth as a continuing requirement. A physical place of business has not been required since January 1, 2021, but an on-site manager must cover the main office and any consumer-facing location.

It depends on how you work. Independent-contractor loan processors must be licensed as mortgage loan originators, which requires at least 20 hours of NMLS-approved pre-licensing education, a passing score on the national and Hawaii test components, and sponsorship by a licensed company. Employee processors who perform clerical or support duties at the direction of a licensed mortgage loan originator are exempt from licensure.

If you will work as an independent contractor, Idaho requires you to hold a Mortgage Loan Originator License. That means completing at least 20 hours of NMLS-approved pre-licensure education (with 2 hours of Idaho law counted within the 20), passing the SAFE MLO test, and filing an MU4 application through NMLS with a criminal background check and credit report authorization. Your employer or sponsoring entity then files the sponsorship request through NMLS.

In Illinois, a sole independent loan processor must hold a Mortgage Loan Originator (MLO) license, and independent loan processing entities must employ one or more licensed MLOs to provide supervision. To become licensed, you complete 20 hours of NMLS-approved pre-license education, pass the SAFE MLO Test with Uniform State Content, file an MU4 in the Nationwide Multistate Licensing System (NMLS), and obtain sponsorship from an Illinois residential mortgage licensee.

It depends on how you are employed. A loan processor who works exclusively as an employee of a licensed or exempt mortgage company is excluded from Indiana's mortgage loan originator (MLO) definition and needs no license. A processor who is not such an employee must obtain the MLO license to engage in residential processing activities. On the Secretary of State track, employees of a licensed Loan Processing Company must hold the license and be sponsored by that company in the Nationwide Multistate Licensing System (NMLS), receiving Approved-Conditional status for processing activities only.

In Iowa it depends on how you are paid. A loan processor or underwriter who is a W-2 employee of a company licensed under chapters 535B, 536, or 536A does not need a mortgage loan originator (MLO) license. An independent-contractor processor or underwriter must meet all MLO licensure requirements, including 20 hours of prelicensing education, passing the SAFE MLO test, fingerprints and a credit report, and the surety bond requirement.

In Kansas, loan processors working as employees at the direction and supervision of a licensed or exempt person do not need the mortgage loan originator license. You must keep the work clerical or supportive: no offering or negotiating loan rates or terms, no counseling consumers about rates or terms, and no holding yourself out to the public as able to perform loan originator activities. If you cross those lines, the loan originator license is required.

Kentucky has not required employee mortgage loan processors to register with the Department of Financial Institutions since July 2016. To work as a processor, you must be hired as a W-2 employee of a licensed entity, which must run a background check and a credit check before hiring you. You must then complete 8 hours of continuing education each year, which the employer documents because it is not reported through NMLS. Non-W-2 contract processors must still register as mortgage loan originators.

In Louisiana, the path depends on how you are employed. A loan processor employed by a licensed mortgage company works under that company's oversight, but a processor working as an independent contractor must be separately licensed by filing Form MU4 through the Nationwide Multistate Licensing System (NMLS), which requires 20 hours of pre-licensing education, a passing score on the SAFE test, and a surety bond.

In Maine, it depends on your role. Employee loan processors who perform only clerical or administrative functions do not need a license. Independent-contract processors must hold a state mortgage loan originator license, which requires 20 hours of NMLS-approved prelicensing education, a passing SAFE test score, fingerprints, a credit report authorization, and sponsorship by a licensed employer.

In Massachusetts, you can work as a loan processor without a Mortgage Loan Originator license if you are an employee rather than an independent contractor, per the licensing exemption in 209 CMR 41.00. You must obtain an MLO license if you also take residential mortgage loan applications or offer or negotiate loan terms for compensation. Note that all licensed Massachusetts MLOs must be W2 employees, so independent-contractor origination is prohibited either way.

You do not need a mortgage loan originator (MLO) license to work as a loan processor, because processing and underwriting activities fall outside the SAFE Act licensing requirement. The license is required the moment you, for compensation, take a residential mortgage loan application or offer or negotiate loan terms. Michigan's statute uses the same standard, so a processor who starts negotiating with borrowers must first be licensed through the Nationwide Multistate Licensing System and Registry (NMLS).

In Minnesota, the path depends on your employment status. A loan processor or underwriter employed by a licensed mortgage company does not need an individual license. An independent-contractor loan processor or underwriter must obtain a mortgage loan originator license, which requires 20 hours of NMLS-approved prelicensing education, a passing score on the National Test Component with Uniform State Content, a background check, and an application through NMLS.

A loan processor in Mississippi needs no MLO license as long as the processor is an employee performing clerical or support duties. An independent contractor processor or underwriter must be licensed as a mortgage loan originator under Section 81-18-7(4), which requires the 20 hours of prelicensing education, the SAFE test, and the background and credit checks. An unlicensed independent contractor may not perform processor or underwriter activities.

Missouri does not require a license to work as a mortgage loan processor. State law excludes processors and underwriters acting solely in that capacity from the mortgage loan originator definition. If the role expands to taking residential mortgage loan applications or negotiating loan terms for compensation, you must obtain an MLO license.

Montana does not require an MLO license for a loan processor or underwriter who works as an employee performing only clerical or support duties at the direction of, and under the supervision of, a licensed mortgage loan originator. Independent-contractor processors do need a license: either the Montana Independent Contractor License or the Montana Mortgage Broker License, along with a responsible individual MLO who has at least 1.5 years of experience.

It depends on how you are employed. Nebraska's interpretative opinions hold that a loan processor or underwriter who is a W-2 employee supervised by a licensed mortgage loan originator does not need an MLO license, but any independent-agent processor or underwriter working for a mortgage banker, mortgage registrant, or installment loan company must obtain one. The employee-versus-independent-agent distinction turns on the company's right of control and W-2 reporting.

Nevada draws the line at employment status. As an employee doing only clerical or ministerial tasks, you need no license. As an independent-contractor loan processor associated with a mortgage company or certificate-of-exemption holder, Nevada treats you as a mortgage loan originator: you must complete 30 hours of pre-licensing education, pass the SAFE MLO test, and obtain sponsorship from a licensed company.

In New Hampshire, a loan processor who works as an independent contractor must hold a Mortgage Loan Originator license, so the path is the same as for originators. You must complete at least 20 hours of NMLS-approved pre-licensure education, including 2 hours of New Hampshire content, pass the SAFE test, and submit fingerprints for an FBI background check along with a credit report authorization. A sponsorship request from your employer is also required before the license takes effect.

New Jersey does not require a license for a loan processor who performs solely clerical or support duties as a supervised employee of a licensed company. If your work expands to taking residential mortgage loan applications or offering or negotiating loan terms, you need a Mortgage Loan Originator license, which requires 20 hours of NMLS-approved pre-licensure education and a passing SAFE Test score.

In New Mexico, a loan processor who performs clerical or support duties as an employee under the supervision of a licensed or exempt mortgage loan originator does not need a license. A processor or underwriter working as an independent contractor, meaning anyone who is not a W-2 employee of a licensed mortgage loan company, must obtain a mortgage loan originator license.

Most loan processors in New York do not need a separate company registration. A W-2 employee who assists a registered mortgage broker or licensed banker is covered by the employer's registration. However, independent contractor processors and underwriters (and their employees) who work on 1-4 family New York residential property must hold an individual mortgage loan originator license, which requires 20 hours of NMLS-approved pre-licensing education including 3 hours of New York law, plus the SAFE MLO test.

You do not need a mortgage loan originator license to work as a loan processor as long as you act solely in that capacity, because the NC SAFE Act excludes individuals who only process or underwrite loans from MLO licensure. You work as a W-2 employee of a licensed mortgage company. If you want to process loans as an independent contractor, the company you work for must register as a mortgage origination support registrant.

It depends on how you work. In North Dakota, an employee processor who performs only clerical or support duties under supervision is not a mortgage loan originator and needs no license. An independent-contractor processor or underwriter must obtain and maintain an MLO license, which requires 20 hours of prelicensing education and a passing score on the SAFE MLO test.

In Oregon, a loan processor who works as an independent contractor, rather than as an employee of a licensed mortgage company, must hold a mortgage loan originator license from the Division of Financial Regulation. That means completing 20 hours of NMLS-approved pre-licensure education including 4 hours of Oregon law, passing the national test, and filing Form MU4 through NMLS with the background check and credit report.

Pennsylvania does not license loan processors who solely process loans as employees of a licensed or exempt company. If you work independently and also perform origination activities, such as taking applications or negotiating terms, you must hold a Mortgage Originator License, which requires 20 hours of pre-licensing education, the SAFE test, and sponsorship by a licensed employer.

Loan processing generally does not require a Rhode Island mortgage loan originator license when the work is ministerial and clerical, an activity Rhode Island expressly exempts. The license is required for people who, for compensation, advise applicants about loan products, help them complete applications, or negotiate mortgage loans. If a processor begins performing those activities, the license is needed.

Processors in South Carolina do not need a loan originator license when they work as supervised employees of a licensed mortgage company. Independent-contractor processors must comply with the Licensing of Mortgage Brokers Act, including keeping a mortgage log of every loan application where a credit report is requested, and must not originate mortgage loans.

In South Dakota, independent-contractor loan processors must obtain a license under SDCL chapter 54-14, the same chapter that governs mortgage loan originators (SDCL 54-14-13.4). To qualify, you must complete the pre-licensing education set by rule, pass the written test, demonstrate financial responsibility, and satisfy the surety bond requirement (SDCL 54-14-13.1 and 54-14-24).

Tennessee does not require a mortgage loan originator license for loan processing. Under the SAFE Act, licensing covers only individuals who take residential mortgage loan applications or offer or negotiate loan terms, and loan processing activities are not covered. If your role expands into taking applications or negotiating terms, you need an MLO license through NMLS.

It depends on how you are employed. A W-2 loan processor or underwriter who works for a licensed mortgage company is exempt from licensing. An independent contractor processor or underwriter must be licensed as a Residential Mortgage Loan Originator under Finance Code § 180.051(b), which means 23 hours of pre-licensing education, the SAFE MLO test, and an NMLS application. Everyone who works for an independent loan processor or underwriter company is treated as an independent contractor and must be licensed.

Vermont does not license loan processors separately. A processor who performs only clerical or support duties as a W-2 employee of a licensed lender or mortgage broker is exempt from licensure. If you work as an independent-contractor processor or underwriter, you must hold a mortgage loan originator license, which means completing the 20-hour pre-licensing education, the test, and the sponsorship requirements.

In Washington, an independent contractor loan processor representing a licensed or exempt mortgage broker or consumer loan company must hold a mortgage loan originator (MLO) license, so the path follows the standard licensing route. Complete 22 hours of NMLS-approved prelicensing education including 4 hours of Washington law, pass the SAFE test, file the application through NMLS, and have your company submit a sponsorship request.

It depends on your employment status. A W-2 employee who works solely as a loan processor or underwriter for a licensed West Virginia lender or broker, under the direct supervision of a licensed MLO, does not need a license. An independent-contractor loan processor or underwriter must hold the Mortgage Loan Originator License, which requires 24 hours of prelicensing education, a passing test score, and the other application steps.

Wisconsin does not require a mortgage loan originator license for loan processors, as long as they do not hold themselves out to the public as able to perform loan originator activities. A processor who takes residential mortgage loan applications or negotiates loan terms for compensation must be licensed. Processors working from home are exempt from the 100-mile office distance rule that applies to licensed originators.