Oklahoma Mortgage Calculator Blog

Becoming a Mortgage Loan Originator (MLO) is a popular career choice for those interested in the mortgage industry. However, before you can start helping people secure loans for their dream homes, you need to obtain an MLO license. This blog post will explore the requirements for obtaining an MLO license, including education, testing, and background checks.

Education Requirements

To become a licensed MLO, you must complete pre-licensing education courses. These courses cover topics such as federal and state mortgage lending laws, ethics, and loan origination practices.

The standard requirement is 20 hours of pre-licensing education, which includes 3 hours of federal law, 3 hours of ethics, 2 hours of non-traditional mortgage lending, and 12 hours of general mortgage origination electives.

Some states may require additional education hours. For example, California requires an extra 2 hours of state-specific education for a total of 22 hours.

NMLS Testing

After completing the required education, aspiring MLOs must pass the SAFE Mortgage Loan Originator Test. This test consists of two parts: a national component and a state-specific component.

The national component covers federal mortgage laws, loan origination activities, and ethics. The state component focuses on individual state laws and regulations.

To pass, you must score at least 75% on both components. If you fail, you can retake the test after a mandatory waiting period.

Background Check and Financial Responsibility

MLO applicants must undergo a criminal background check and have their fingerprints taken. This process helps ensure the integrity of the mortgage industry.

Additionally, applicants must demonstrate financial responsibility. This may include a credit check and disclosure of any bankruptcies or financial judgments.

State-Specific Requirements

While federal requirements are consistent across the country, individual states may have additional requirements for MLO licensure.

For instance, Massachusetts requires applicants to submit a completed application, pay a license fee, and provide a surety bond. You can find more information about Massachusetts-specific requirements here.

California, on the other hand, has its own set of FAQs for MLO applicants, which you can review here.

Continuing Education

Once licensed, MLOs must complete annual continuing education to maintain their license. This typically involves 8 hours of courses, covering similar topics to the pre-licensing education.

Continuing education helps MLOs stay up-to-date with changes in laws, regulations, and industry best practices.

Career Opportunities

Obtaining an MLO license opens up various career opportunities in the mortgage industry. You can work for banks, credit unions, or mortgage companies, or even start your own mortgage brokerage.

To learn more about potential career paths in mortgage lending, check out our article on career paths in mortgage lending.

Industry Knowledge

As an MLO, it's crucial to have a solid understanding of the mortgage industry and the various types of mortgage loans available.

For a comprehensive overview of the mortgage industry, read our mortgage industry overview article.

To familiarize yourself with different loan types, take a look at our guide on types of mortgage loans.

Wrapping Up

Obtaining an MLO license requires dedication and effort, but it can lead to a rewarding career in the mortgage industry. By completing the necessary education, passing the NMLS test, and meeting state-specific requirements, you'll be well on your way to becoming a licensed Mortgage Loan Originator. Remember to stay informed about industry changes and continue your education to maintain your license and provide the best service to your clients.