Mortgage Broker: How to Become a Mortgage Loan Broker?
Research the requirements to become a mortgage loan broker. Learn about the job description and duties and read the step-by-step process to start a career as a mortgage loan broker.
Requirements for a Career as a Mortgage Loan Broker
A mortgage broker works for a prospective homebuyer to arrange a home loan. They act as an intermediary between the homebuyer and mortgage lender, and may be the fiduciary of the buyer. Legally, they are considered a type of financial institution, even if they work as an independent contractor. The job tasks they perform are similar to those the U.S. Bureau of Labor Statistics (BLS) describes as completed by loan officers.
Loan officers must have at least a high school diploma and, pursuant to the Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) of 2008, be licensed. To earn licensure, these officers must complete 20 hours of education. The chart below contains the basic requirements to work as a mortgage broker:
|Degree Level||High school diploma*|
|Certification or Licensure||Mortgage brokers must be licensed in the state in which they work*|
|Key Skills||Knowledge of law, government, economics and accounting as well as critical-thinking skills**|
|Computer Skills||Familiarity with document management, financial analysis and accounting software programs**|
Sources: *U.S. Bureau of Labor Statistics, **O*Net Online.
Step 1: Complete Related Courses
The minimum level of education required to work as a mortgage broker is completing high school. However, to connect borrowers and lenders, a mortgage broker must be able to review financial documents and conduct research. Classes in computer use, keyboarding, research skills and math may help prepare an individual to work as a mortgage broker.
Step 2: Attend Pre-Licensure Education
Pursuant to the 2008 SAFE Act, all mortgage brokers must be licensed. Records of non-financial related licenses issued throughout the nation are maintained by the National Mortgage Licensure System (NMLS). The NMLS also provides guidance on obtaining licensure to aspiring mortgage brokers.
To become licensed, an individual must complete a 20-hour pre-licensure program and pass an exam. The 20-hour education programs are available throughout the U.S. and provide instruction about relevant federal laws and regulations, loan officer ethics and mortgage origination.
- Prepare for the exam. Outlines and a handbook are available on the NMLS website. These items may help individuals prepare for their licensure exam and, in doing so, make it more likely that they will pass the exam the first time.
Step 3: Take the Licensure Exam
Aspiring mortgage brokers must pass the SAFE Mortgage Loan Originator Test. This test includes national and state parts. All aspiring brokers take the same national test, while the state portion of the test differs depending on the state in which the individual intends to work when licensed. Exams can be taken on demand throughout the U.S.
Step 4: Begin Working as a Mortgage Broker
An individual can work as a mortgage broker after passing the SAFE exam and becoming licensed. A mortgage broker may negotiate mortgage loans, accept funds to invest in real estate and sell or oversee mortgage loans.
Step 5: Complete Continuing Education
Licensed mortgage brokers must complete continuing education to retain their licensure. Specific requirements can vary by state, but typically include completing continuing education hours every year.
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