Obtaining a mortgage broker license which is now known as the Loan Originator license is a great step for anyone wishing to work in the financial side of the home buying process. Much like becoming licensed in other areas of the real estate field, becoming a loan originator requires pre-license education and passing both a state and national exam. If you want to become a loan originator, here are the steps you need to get there:
1. Know the Difference
First, it is important to know and understand the role of a loan originator. Although the process of obtaining a license is similar the job of a loan originator is not the same as that of a real estate licensee. Loan originators are the connection between clients seeking loans for their homes and loan lenders. They find the best loan for their clients at the best rate. Loan originators help homebuyers get the money necessary for their home while real estate agents assist in helping buyers find a property. Many aspects of the loan originator license process will be done through the NMLS system which is the Nationwide Mortgage Licensing System.
2. Education and Exam
The loan originator license also differs in the number of hours of education needed before and after acquiring the license. Before taking the loan originator exam you must complete a 20 hour course from an approved pre-licensing school. Some states require state specific education in addition to the 20 hour course. Florida does not have this requirement but there are online prep courses available for both the state and national exams. The exam covers topics such as state laws and acts, regulations, real estate and financing and is designed to test your knowledge about the mortgage and financing world. Loan originator licenses must be renewed annually by December 31st. You will be required to take an additional 8 hour course each year. The exception to this rule is if your are licensed in the year that you renew. In this case you would still need to do the renewal but not the education.
3. Application Process
Once you have passed the exam, you must submit additional information to get your license:
- Submit Individual (MU4) Form in NMLS – This form is for individuals applying for a loan originator license.
Once the MU4 is submitted NMLO will begin reviewing the application and the following information:
- Pay the statutorily required application fee ($195) and guaranty fund fee ($20)
- Complete the 20-hour NMLS approved course
- Passing score on both the national test component with uniform state content and the Florida state portion of the SAFE test
- FBI criminal history background check results with fingerprints
- State criminal history background check results
- Authorize a credit report
4. High School Education – submit an email to NMLSHighSchool@flofr.com with the name of the school you attended and the date you received your diploma or equivalent. Provide your NMLS# in the subject line of the email.
5. Applicant must be at least 18 years of age
6. FBI criminal background check and state criminal background check – For both criminal background checks you must get fingerprinted. For the state criminal background check, your fingerprints can be done by a live scan vendor that is approved by the Florida Department of Law Enforcement. For the FBI background check, your fingerprints must be done an NMLS authorized live scan vendor. They will then be submitted to the Florida Department of Law Enforcement and to the Federal Bureau of Investigation for state and national background checks.
7. Disclosure Questions – You will need to be sure to provide all needed documentation in regard to background questions that may have been answered with a “Yes”
8. Credit Report – Applicant must authorize the Registry to obtain and make available to the Office of Financial Regulation an independent credit report on the applicant.
Government and Regulation
Loan originators are also regulated under a different branch of the government. While Florida real estate agents are regulated by the Florida Real Estate Commission, loan originators are regulated by the Florida Office of Financial Regulation. This further demonstrates the difference between loan originators and real estate agents. Since loan originators are responsible for handling the money aspect of the home buying process they are regulated by a financial sect of the state government.
Becoming a loan originator is a great way to work hands-on with home buyers. If you enjoy working with others and dealing with finances becoming a loan originator will be a great step for you. Find out more about the required courses needed for your license by talking to one of our expert career counselors today!