What disqualifies you from becoming a mortgage loan officer?

Federal minimum standards disqualify applicants who have had a loan originator license revoked in any jurisdiction, or who have a felony conviction in the 7 years before applying, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. States also require demonstrated financial responsibility, character, and general fitness, which is why applicants authorize an independent credit report. Expunged and pardoned convictions do not by themselves affect eligibility.

An Alabama MLO license is barred for anyone who had an MLO license revoked in any jurisdiction, or who has a felony conviction (or a guilty or nolo contendere plea) within the past 7 years, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. Denial is also possible for lack of financial responsibility, which can include current outstanding tax liens, a foreclosure within the past 3 years, or a pattern of seriously delinquent accounts in the past 3 years. A credit score or credit report alone cannot be the basis for denial.

Alaska disqualifies an applicant who has been found guilty of, or has pled guilty or no contest to, any felony within seven years before the application date. An applicant who has had a mortgage-related license revoked in any governmental jurisdiction also cannot be licensed. Financial responsibility is a further bar: a credit score below 600 fails the standard under 3 AAC 14.063.

Arkansas can deny or revoke a loan officer license for a felony conviction, for an offense involving breach of trust, moral turpitude, money laundering, or fraudulent or dishonest dealing within the past 10 years, or for any offense involving mortgage lending, securities, insurance, or other financial-services activity. The credit review also weighs financial responsibility: bankruptcy within the past 5 years, foreclosure within the past 3 years, and current judgments or tax liens are indicators, though the credit report is not the sole basis for denial.

The SAFE Act bars licensure for anyone convicted of a felony involving fraud, dishonesty, breach of trust, or money laundering, anyone convicted of any felony in the 7 years before applying, and anyone who has had a loan originator license revoked in any jurisdiction. Applicants must also demonstrate financial responsibility, character, and general fitness. Bankruptcy, foreclosure, and other credit issues do not automatically disqualify; the Department of Real Estate reviews each application individually.

Colorado law requires the board to deny an applicant whose MLO or similar license was revoked in any jurisdiction, anyone with a felony conviction involving fraud, dishonesty, breach of trust, or money laundering in any court at any time, and anyone with any other felony conviction within the immediately preceding 7 years. A person whose license was revoked is also ineligible for 2 years after the revocation date. The SAFE Act and Colorado licensing laws automatically preclude licensure for certain felonies.

Connecticut will not issue a mortgage loan originator license if you have had such a license revoked in any jurisdiction, or if you were convicted of (or pled guilty or nolo contendere to) a felony in the 7 years before applying, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. The Department of Banking also screens financial responsibility: current outstanding judgments (except medical), current tax or government liens, a foreclosure within the prior 3 years, or a pattern of seriously delinquent accounts can disqualify you.

The Delaware State Bank Commissioner will not issue an MLO license to an applicant who has ever had such a license revoked in any jurisdiction, or who was convicted of or pled guilty to a felony in the past 7 years (at any time, if the felony involved fraud, dishonesty, breach of trust, or money laundering). Financial problems can also disqualify an applicant: current outstanding judgments (other than medical), tax or other government liens, foreclosures in the past 3 years, or a pattern of seriously delinquent accounts in the past 3 years.

Under D.C. Code § 26-1103(c-1), denial is mandatory if the applicant had an MLO license revoked in any jurisdiction, was convicted of a felony during the 7-year period preceding the application, or was convicted at any time of a felony involving fraud, dishonesty, breach of trust, or money laundering. The Commissioner also evaluates financial responsibility and general fitness, based on the fingerprints, criminal background check, credit report, and disclosure of administrative, civil, or criminal findings included with the application.

Florida must deny a loan originator license to anyone whose loan originator license, or its equivalent, has been revoked in any jurisdiction. The state also weighs a pending felony prosecution or enforcement action involving fraud, dishonesty, breach of trust, money laundering, or moral turpitude. Under federal minimum standards, a felony conviction in the 7 years before applying, or at any time if it involved fraud, dishonesty, breach of trust, or money laundering, also disqualifies. Adverse credit is judged on the totality of the circumstances, and no credit score cutoff applies.

A felony conviction, guilty plea, or nolo plea within the previous 7 years disqualifies you, and a disqualifying crime under O.C.G.A. § 7-1-1000(7.1) bars you no matter how old it is, unless the felony was remedied by a pardon under O.C.G.A. § 7-1-1004(i). Financial responsibility problems can also block licensure. The Department reviews your whole credit report, and judgments, child support in arrears, tax liens, charge-offs, and foreclosures or short sales with a deficiency can disqualify you unless a payment plan is in place with at least 3 consecutive payments made before you apply.

The Idaho Department of Finance finds an applicant lacking financial responsibility for a pattern of disregard in managing personal finances. Factors include outstanding judgments and tax liens, collections or charged-off non-mortgage accounts over $5,000, cumulative non-mortgage past-due balances over $1,000, and a 3-year pattern of delinquency including foreclosure. A bankruptcy alone is not a basis for denial, and Idaho has no minimum credit score. Felony convictions and financial-services misdemeanors must be disclosed with court records and a written explanation.

Illinois does not disqualify applicants on a single factor alone. IDFPR reviews an applicant's credit history in its entirety and states that a decision is not made solely on the credit score. Applicants must answer disclosure questions on child support delinquency, defaulted Illinois educational loans, and unpaid Illinois taxes; a yes answer requires uploading a court-ordered payment plan. Licensed MLOs must report a felony conviction or an adverse judgment of $500 or more to the Director through NMLS.

Iowa disqualifies applicants whose mortgage loan originator license was revoked in any jurisdiction, unless the revocation was formally vacated, and anyone convicted of a felony in the 7 years before applying, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering (Iowa Code 535D.6). The superintendent may also deny a license for causes such as a conviction involving forgery, embezzlement, or theft; revocation of any professional license in any state; false statements on the application; being under 18; or unpaid child support or state debt.

You cannot become a state-licensed loan officer if you have had a loan originator license revoked, have been convicted of a felony in the past seven years, or have ever been convicted of a felony involving fraud, dishonesty, breach of trust, or money laundering. You must also demonstrate financial responsibility and general fitness, and pass the national test with a score of 75% or higher. The OSBC may consider disclosed criminal convictions or civil actions involving fraud, dishonesty, trustworthiness, or financial wellbeing when reviewing your application.

Kentucky disqualifies an applicant whose loan originator license or registration was previously revoked, or who has a felony conviction, guilty plea, or nolo contendere plea within the 7 years before applying, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. Applicants must also show financial responsibility: a credit score of 600 or higher meets the standard, while scores below 600 draw review of outstanding judgments, tax liens, and foreclosures, bankruptcies, or delinquent accounts within 5 years.

Louisiana will not issue a mortgage loan originator license to an applicant convicted of, or who pleaded guilty or no contest to, a felony within the 7 years before applying, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. A revoked MLO, lender, broker, or servicer license in any jurisdiction also disqualifies the applicant, unless the revocation was vacated. The state additionally requires demonstrated financial responsibility, character, and general fitness.

A felony conviction in the preceding 7 years disqualifies you, and any conviction for fraud, dishonesty, breach of trust, or money laundering disqualifies you no matter how long ago it occurred. Federal standards also bar anyone whose loan originator license has been revoked, and require demonstrated financial responsibility, character, and general fitness. Credit report information cannot be the sole basis for denial in Maine, but the Bureau may require written explanations of derogatory accounts.

Maryland law bars the Commissioner of Financial Regulation from issuing an MLO license to an applicant whose MLO license was ever revoked in any jurisdiction. An applicant is also disqualified if convicted of, or having pled guilty or nolo contendere to, a felony within 7 years before applying, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. A pardoned conviction does not count, and the applicant must also show financial responsibility, character, and general fitness.

The Commissioner of Banks must deny an application if the applicant had a mortgage loan originator license revoked in any jurisdiction, or was convicted of (or pled guilty or admitted to sufficient facts to) a felony in the prior 7 years, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. Denial is also required for failing to show financial responsibility, such as outstanding judgments, tax liens, a foreclosure within the past 3 years, or seriously delinquent accounts, and for failing the pre-licensing education or the test.

Minnesota will not issue an MLO license to anyone who has ever had an MLO license revoked, or who has a felony conviction or guilty plea within the past 7 years, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. Financial problems can also block issuance: current outstanding judgments (except medical-only), tax liens or other government liens, foreclosures within the past three years, or a pattern of seriously delinquent accounts within the past three years.

Mississippi will not issue an MLO license if the applicant has ever had an MLO license revoked in any governmental jurisdiction. A conviction for, or guilty or nolo contendere plea to, a felony within the 7-year period before applying is also disqualifying, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. Pardons and expungements do not count as convictions, and the department also requires demonstrated financial responsibility, character, and general fitness.

The Division of Finance will not issue an MLO license if your MLO license was revoked in any governmental jurisdiction, or if you were convicted of, or pleaded guilty or nolo contendere to, a felony in the 7 years before applying, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. Lack of financial responsibility also disqualifies you, shown by outstanding judgments (except medical), tax or other government liens, a foreclosure within the past 3 years, or a pattern of seriously delinquent accounts within the past 3 years.

Montana may deny an application or renewal for a felony conviction within the 7 years before applying, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. Other grounds include prior revocation of a mortgage loan originator (MLO) license in any jurisdiction, failure to show financial responsibility, character, and general fitness, incomplete prelicensing education, not passing the SAFE test, and material misstatements. A pardoned or expunged felony does not force automatic denial, though the department may consider the underlying facts.

Nebraska permanently bars anyone with any felony conviction, or with a misdemeanor conviction involving fraud, dishonesty, or a financial-industry offense, from holding an MLO license. A revoked MLO license in any jurisdiction is also disqualifying. Financial problems do not automatically disqualify you, but the Department of Banking and Finance reviews judgments, tax liens, delinquent accounts, foreclosures in the past 3 years, and bankruptcies in the past 10 years; medical debt is excluded if documented.

Nevada will not license an applicant with a felony conviction or guilty or nolo contendere plea within the 7 years before applying, or at any time if the felony involved fraud, dishonesty, breach of trust, money laundering, or moral turpitude. An applicant must never have had an MLO or mortgage company license revoked in any jurisdiction, and must not have had a financial-services license revoked in the preceding 10 years. Financial responsibility also fails if a credit history shows a lien, judgment, or disciplinary action tied to fraud or mishandled trust funds.

Under SAFE Act licensing standards, an applicant is disqualified who has had a loan originator license revoked, who has a felony conviction within the statute's recent-felony look-back period, or who has ever been convicted of a felony involving fraud, dishonesty, breach of trust, or money laundering. Applicants must also demonstrate financial responsibility and general fitness. In New Hampshire, each yes answer on the MU4 disclosure form requires an explanation and supporting documents, such as court records or bankruptcy filings.

The SAFE Act disqualifies applicants who have had a loan originator license revoked, been convicted of a felony in the past seven years, or ever been convicted of a felony involving fraud, dishonesty, breach of trust, or money laundering. New Jersey also requires demonstrated financial responsibility, character, and fitness, a credit report review, and a state criminal history check showing no disqualifying record. A denied application or revoked license in any jurisdiction also blocks eligibility.

Federal rules disqualify anyone who has had a loan originator license revoked, or who was convicted of or pled guilty to a felony in the 7 years before applying, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. States may also deny a license for failing financial responsibility standards; New Mexico reviews a credit report and requires written explanations for derogatory accounts. A fingerprint-based FBI background check also applies.

New York disqualifies mortgage loan originator applicants with a felony conviction in the preceding 7 years, or a felony at any time if it involved fraud, dishonesty, breach of trust, or money laundering. A prior mortgage license revocation or suspension, a previous application denial in any jurisdiction, or a cease-and-desist order also disqualifies. Poor credit is not an automatic bar, but DFS requires an explanation and supporting documentation for derogatory items on the credit report.

North Carolina disqualifies applicants for a revoked MLO license in any jurisdiction unless vacated, a felony conviction (at any time if it involved fraud, dishonesty, breach of trust, or money laundering), or a misdemeanor conviction within the past 5 years involving fraud, theft, perjury, forgery, or similar offenses. Financial problems can also disqualify an applicant, including outstanding judgments, current tax liens, a foreclosure within the past 3 years, or a pattern of seriously delinquent accounts.

You cannot qualify if you have had a mortgage license revoked, or have a felony conviction involving fraud, dishonesty, breach of trust, theft, or money laundering. A felony conviction within the past 7 years or a misdemeanor theft conviction within the past 7 years is also disqualifying. Financial responsibility matters too: past-due, collection, or charged-off accounts exceeding $5,000, or a foreclosure or bankruptcy filed within the past 5 years, can weigh against you. A conviction is not an automatic bar; Ohio reviews each case individually.

Under 59 O.S. § 4000.1(F), the Oklahoma Department of Consumer Credit may deny a license based on criminal offenses, including offenses enumerated in Section 571 of Title 57, offenses requiring sex offender registration, public corruption, embezzlement of money, failure to pay and collect tax, and conspiracy to defraud the state, or equivalent laws from another jurisdiction. Applicants may request a determination of whether their criminal background may disqualify them before submitting an application.

Oregon disqualifies you if you were convicted of a felony within the past 7 years, if you were ever convicted of a felony involving fraud, dishonesty, breach of trust, or money laundering, or if any state has revoked a mortgage license. The Division of Financial Regulation also reviews your credit history; bankruptcies, unpaid judgments, unpaid liens, a foreclosure within the past 3 years, and accounts 90 or more days past due can lead to denial or a conditional license, though medical-related issues will not be the basis of denial.

Pennsylvania requires denial of a mortgage originator application if the applicant was convicted of any felony during the 7 years before applying, or of a fraud, dishonesty, breach of trust, or money laundering felony at any time. A prior license revocation also mandates denial, as does a lack of financial responsibility, such as outstanding judgments or government liens, a foreclosure in the past 3 years, or a pattern of seriously delinquent accounts in the past 3 years.

Rhode Island denies licensure for a felony conviction, or a guilty or nolo contendere plea, within the 7 years before the application, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. Applicants can also be found to lack financial responsibility for current outstanding judgments, outstanding tax liens or other government liens, foreclosures within the past 3 years, or a pattern of seriously delinquent accounts within the past 3 years. A pardon or expungement is not treated as a conviction.

South Carolina disqualifies applicants who have a felony conviction in the 10 years preceding application, or a felony at any time if it involved fraud, dishonesty, breach of trust, or money laundering. You are also disqualified if you have ever had a loan originator license revoked in any jurisdiction, or if you are under 18. Misdemeanors in the last 10 years do not automatically disqualify you, but you must submit a letter of explanation, and felony convictions require the final disposition documents.

The director may not issue an MLO license if you ever had an MLO license revoked in any jurisdiction, or if you were convicted of or pled guilty or nolo contendere to a felony within the seven years before applying, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. A lack of financial responsibility also blocks licensure, based on current outstanding judgments (except medical-expense judgments), tax or governmental liens, foreclosures within the past three years, or a pattern of seriously delinquent accounts within three years.

Several standards can disqualify an applicant. An applicant must never have had a loan originator license revoked in any jurisdiction, and must have no felony conviction within the 7 years before applying. A felony involving fraud, dishonesty, breach of trust, or money laundering bars licensure at any time. The Tennessee Department of Financial Institutions also screens for financial responsibility, character, and general fitness, using the credit report and criminal background check submitted through NMLS.

Texas bars licensure for anyone convicted of, or who pled guilty or no contest to, a felony in the 7 years before applying, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering (Finance Code Section 180.055). A prior RMLO license revocation in any jurisdiction also disqualifies you. Applicants must be U.S. citizens or lawfully admitted aliens, and the credit review can lead to denial for judgments, tax liens, charge-offs, or collection accounts, though medical-expense judgments and delinquent student loans are not considered.

Several conditions can disqualify you from licensure. A denied loan originator license application, a license revoked or suspended in any jurisdiction, a cease and desist order, or a conviction for a misdemeanor or felony that would preclude licensure each bar eligibility, including temporary authority. A renewal can also be denied for a felony conviction or plea agreement during the renewal period, or for a finding of fraud, misrepresentation, or deceit. Applicants must also show honesty, integrity, truthfulness, competency, and financial responsibility.

Virginia will not issue an MLO license if you have ever had one revoked in any jurisdiction, or if you were convicted of or pled guilty to a felony within the past 7 years, or at any time if the felony involved fraud, dishonesty, breach of trust, or money laundering. Financial problems can also block licensure: judgments or collections over $2,000, tax or governmental liens over $1,000, delinquent accounts over $3,000, or a foreclosure within the past 7 years. These financial items are not automatic bars if you show good-faith repayment efforts that were substantially impeded by hardship.

Washington disqualifies applicants who were ever convicted of a felony involving fraud, dishonesty, breach of trust, or money laundering; who were convicted of any other felony, or a gross misdemeanor involving dishonesty or financial misconduct, within 7 years of filing; or who ever had a loan originator license revoked. DFI also reviews credit: current outstanding judgments (except medical-only), tax liens, a foreclosure in the last 3 years, or a pattern of seriously delinquent accounts in the past 3 years can bar licensure, and $100,000 or more in tax liens makes an applicant ineligible.

West Virginia may not issue you an MLO license if you have had an MLO license revoked in any jurisdiction, if you were convicted of or pled guilty to a felony within the five years preceding your application (or at any time when the crime bears a rational nexus to MLO duties), or if you have not shown financial responsibility. Financial responsibility problems include outstanding judgments (except medical), tax or government liens, recent foreclosures, and a pattern of seriously delinquent accounts. A credit score alone cannot be the basis for denial.

Wyoming adds its own disqualifiers on top of the federal Secure and Fair Enforcement (SAFE) Act standards. An applicant does not qualify with any outstanding judgment (except one solely from medical expenses), any outstanding tax lien or other government lien, a foreclosure within the past 3 years, or a residence more than 100 miles from a licensed location. Federal rules also bar anyone with a disqualifying felony conviction or a revoked loan originator license in any jurisdiction.