Your guide to starting a career as a mortgage loan officer in California
Are you looking for a career where earning a six-figure salary is fairly easy and opportunities for growth are abundant?
Working in the mortgage loan and finance industry is a rewarding and fulfilling profession, especially if you are someone who likes crunching numbers and interacting with people.
Mortgage loan officers play an integral part in the home buying and refinancing journey and are employed by financial institutions like banks, credit companies, and mortgage providers.
The mortgage lending and finance industry in California is currently flush with the demand for skilled and licensed mortgage loan officers, originators, and brokers.
If you are interested in becoming a mortgage loan officer and building a long-term, thriving career, now is a good time to get started.
California’s real estate market is on a steady growth trajectory and continues to attract homebuyers, skilled workers, and retirees from around the country.
Due to the housing rush in California, the demand for mortgage loans and financing has been increasing rapidly.
To help individuals and companies meet their needs, the number of job openings for loan officers, brokers, and loan originators is growing too.
This means you can reap benefits from the ripe job market landscape and enjoy the plethora of job opportunities available in the mortgage lending industry.
When it comes to earning potential and salary benefits, skilled MLOs in California can make around $130K while enjoying additional job perks and work-life flexibility.
However, to start working as a mortgage loan officer, originator, or mortgage broker, you must first complete mandatory education and earn a license.
In California, it is mandatory for aspiring professionals to obtain their California MLO license before starting their career in the lending and mortgage finance industry.
If you are curious to explore how to become a mortgage loan originator in California and what exactly the career path requires from you, then keep on reading this article.
We have put together a beginner’s guide for all aspiring loan officers and brokers in California who want to work with home buyers and help them secure mortgage financing.
To help you understand the job requirements, and skills and help you set the right career expectations, we will cover the key aspects of becoming a licensed loan originator in CA.
The Role of a Mortgage Loan Officer
Given the exciting growth prospects and rewarding benefits, you might already be wondering “How do I become a loan officer in California” and kickstart a new career.
Before you get too ahead of yourself, it is important to get a clear understanding of the role of mortgage loan originator and what the job profile entails.
Since mortgage lending, finance, and real estate industries are related to each other, you will be handling multiple tasks and duties at work.
It is important to note that mortgage loan originators and loan officers are two separate job profiles often used interchangeably for the common duties and responsibilities they share.
Some of the core responsibilities of a mortgage loan officer or originator are listed below.
- Meet and interview prospective clients:
Mortgage loan officers and brokers are required to respond to texts, emails, and inquiries from potential clients and homebuyers. As a loan officer, you will be meeting with clients and interviewing them to understand their needs and requirements. Based on the interactions, you should be better prepared to assist them and evaluate their creditworthiness.
- Prepare the loan application:
This is one of the major job responsibilities of a mortgage loan officer as they are expected to help their clients prepare the documentation and fill out the different sections of a loan application. As a loan originator, you must ensure that every information submitted by your clients is accurate, up-to-date, and truthful.
- Advise the best mortgage plans:
A mortgage loan officer works as an advisor and an advocate for their client’s needs by helping them choose the most suitable mortgage financing plan. Based on your research and knowledge, you must educate your clients about the various options available in the market and provide clear explanations to help them make an informed choice.
- Submit the required paperwork:
Getting a mortgage loan requires the submission of a number of financial and personal documents such as income stubs, bank statements, credit reports, and tax receipts. As an MLO, you will be guiding clients on how to procure and submit the required documents and prepare the loan application for fast and seamless approval.
- Help negotiate the best interest rates:
A skilled and knowledgeable mortgage loan officer must assist their clients in negotiating the terms of a mortgage plan, including the interest rates and closing costs. You will be expected to help your clients save money and make sound decisions related to deciding the best terms and conditions of the repayment on the basis of the needs of their clients.
- Providing timely application updates:
A mortgage loan officer’s job does not end after submitting the loan application, as they are also involved in the tracking of the application status. A loan officer provides timely updates for important milestones to keep their clients on track for repayment and to avoid missing any payment or renewal dates.
- Maintaining paperwork and files:
Loan officers and originators deal with a range of critical documents and important paperwork. Your employer will expect you to keep a centralized and updated repository of all client-related information in a secure and safe way.
In addition to the above list, you will be required to maintain positive relationships with clients even after the mortgage loan application process is completed.
Although customer service is not a core job responsibility of a loan officer or a mortgage broker, it is an important aspect of their profession.
Since MLOs have to interact with people and assist them through the process of obtaining a loan, it is expected that you learn how to put your client’s needs first.
Remember that the career objective of a loan originator is to work with clients, assist them, and provide guidance through the various stages of a loan application.
As you grow and advance in your career, you might be expected to take on a more managerial role where you will be mentoring and overseeing junior loan officers.
Note that your exact job duties and responsibilities might vary depending on your employer, however, by now, you must have a clear idea about what a loan originator does.
Basics of NMLS MLO Licensing
If you have made up your mind to embark on the professional journey to work as an MLO in California, it all comes down to preparing for the state-specific requirements.
You might be thinking how do I become a mortgage broker in California and get my license easily?
Getting a license might seem overwhelming or daunting at first, but with proper preparation and clarity, you can approach it in a step-by-step way to achieve your goal.
Like most states, California also follows the NMLS (Nationwide Multistate Licensing System) to process licensing applications and grant licenses to applicants.
NMLS is the country’s largest centralized database for maintaining the records and details of all licensed professionals, companies, and institutions in the nonbanking, lending, and financial services industries.
It is the duty of the NMLS to register the licensing information for all active loan originators, officers, and mortgage brokers in California and other 49 states in the country.
NMLS assigns unique identifiers or identification numbers to each individual who wants to apply for a new license or renew an existing one.
NMLS oversees the working and regulation of the mortgage lending industry across the country.
Hence, if you want to work in the mortgage lending industry in CA, you must meet the NMLS guidelines for loan officers and mortgage brokers.
Steps to obtain a MLO license in California
So, you want to know how to become an MLO in California and obtain your license? Congratulations on making a decision to benefit your career!
To become a licensed loan officer or originator, you must go through a step-by-step process while ensuring NMLS guidelines and state-specific requirements are duly fulfilled.
Step 1: Register with the NMLS
Like most states, California requires aspiring loan officers and brokers to register with the NMLS to become eligible to work in the industry.
To do so, you can visit the NMLS online portal and register to obtain your unique NMLS identification number.
Step 2: Meet the educational requirements
The job profile of a mortgage loan originator requires you to have specific knowledge about finance, lending, and accounting in general.
Education is the starting point of your journey to becoming a successful mortgage loan officer in California.
Having a bachelor's degree, preferably in the field of finance, accounting or business administration is a must as it can provide you with the educational background you need to qualify for the job.
Step 3: Meet the pre-licensing requirements
According to the NMLS licensing requirements for MLOs, you must complete the mandatory pre-licensing education to become eligible.
The NMLS requires applicants to complete specific pre-licensing courses for a total duration of 20 hours.
Below are some of the courses you will need to complete as part of your pre-licensure training:
- Real Estate Financing
- State and Federal Laws
- Ethics, Fair Trade, and Consumer Rights Protection
- Underwriting
- Financial Regulations
These courses will give you a fundamental understanding of the real estate industry, its rules and regulations, and the role of financial institutions.
Step 4: Pass the NMLS MLO licensing exam
Once your pre-licensing education is completed, the next step is to take and successfully clear the NMLS MLO licensing exam in California.
Known as the SAFE (Secure and Fair Reinforcement) test, it is formulated to evaluate your preparedness and knowledge of the course curriculum you have studied in your pre-licensing education.
In order to pass this SAFE MLO licensing exam in California, you must score a minimum of 75% in your final score.
Step 5: Obtain your mortgage originator license
Congratulations on clearing the licensing exam successfully! You are now one step away from starting a career to becoming a licensed mortgage loan officer.
To obtain your license, you must submit your electronic fingerprints and a credit report to the NMLS for approval. Once approved, you will receive your MLO license in a few weeks.
Step 6: Find employer sponsorship
Simply getting an NMLS-approved license is not enough to start working in the industry.
The California MLO regulations require you to find a job with an established and authorized lender, broker, or financial institution and learn the workings of the profession.
By finding employer sponsorship from a California-based financial institution or credit company, you can legally start working with clients who want to obtain a mortgage.