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A Mortgage Loan Officer (MLO) plays a vital role in helping consumers buy a home or open a storefront for their business. There are plenty of reasons why this is an exciting field to get into. First of all, once you have obtained your mortgage license, along with any required prelicensing education, it’s a growing and stable market. People are always going to be looking to real estate to buy so you know your skills will continue to be valuable. MLOs typically get paid through commission. That means the better you are at your job, the more money you can make.

MLOs have a great work/life balance, too. You get to set your own hours and you aren’t stuck behind a desk in an office all day. You have the freedom to schedule meetings with clients where and when it suits both you and them.

Don’t overlook one of the biggest benefits to this profession: MLOs genuinely help people. A lot of people who are looking to buy a home or a business location aren’t sure where to begin. By using your knowledge and expertise, you can help people realize their dreams.

Before you can practice as a MLO, you first need to get licensed. There’s a few steps that you’ll need to take to make sure this process is as smooth as possible.

What Is a MLO?

Basically, a MLO‘s role is help a borrower purchase property. They usually specialize in either residential or commercial real estate. Anyone who needs help purchasing a family home or finding a location for their business will be in frequent and regular contact with a MLO.

Most banks, credit unions, and mortgage companies have MLOs because it is a very specialized field. They help borrows find the right loan programs, fill out loan applications, assist with collecting any necessary paperwork, and communicating with other professionals involved in the process. Sometimes, a MLO might have information that the consumer doesn’t know, like special loan programs or credits to apply for. A MLO truly is an important part of securing a mortgage and buying a home or storefront.

What Are the Requirements for Becoming a MLO?

Generally, to start your career and get a real estate license, a high school diploma is all that’s required and you will hear many success stories about mortgage lenders and real estate professionals, though some institutions often prefer that you have a bachelor’s degree in finance, business, or economics. While you can practice as a MLO without one, a bachelor’s degree will make you more competitive in the field as a real estate professional. It will also qualify you for higher positions in the future as well as for license renewal, making you more marketable in the long run. You’ll be better trained at analyzing financial records and have a better grasp on the accounting aspects of the work.

You can’t practice legally unless you get your MLO license. Once you get licensed, you can also pursue several certification options if you want to be more specialized.

In addition to these academic requirements, there are some personal traits that will make you a good MLO, too. Strong communication skills are very important. You also have to be self-motivated since a lot of MLOs spend a lot of time out of the office. MLOs are usually paid on commission and is not a good field for someone who prefers to punch a clock.

How to Obtain a MLO License Endorsement

There are several steps to take to pursue a MLO license. Please note that the process and requirements vary from state to state. Before you start the process, make sure that you research the specific requirements needed to get a license in the state you plan to practice.

1. Get a proper education

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As we’ve already mentioned, a high school diploma is adequate, but a bachelor’s degree is preferred by a lot of organizations. With a bachelor’s, you’ll be more prepared for the requirements of the job and will be more marketable in the future.

2. Gain Work Experience

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You don’t necessarily have to have loan officer experience but anything that relates to the field will make it easier to obtain a license, especially if you don’t have a bachelor’s degree. Some great options to gain experience are getting a job in customer service or sales or even working in a bank or credit union.

3. Complete Required Coursework

The Nationwide Multistate Licensing System (NMLS) oversees pre-licensure education and approves the classes. You’ll need to complete a total of at least 20 hours. This time is further broken down into specific areas which usually include, 3 hours of Federal laws and regulations, 3 hours of ethics with a focus on fraud and fair lending, 2 hours of nontraditional mortgage products, and 12 hours of a variety of mortgage origination.

4. Study for the Exam

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There are a lot of ways to prepare for the test. You can take a class, do tutorials on your own, study as much as you can using the method that works best for you.

5. Take the Exam

The exam consists of a both a national section and a state specific one. It consists of 125 multiple choice questions across 5 different categories: federal mortgage laws, general knowledge, mortgage loan origination activities, ethics, and stat content. There are in-depth resources available that break these categories down into more specific subjects that might be covered.

6. Maximize and Maintain Your License

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After you get your license, there are 2 things to consider. The first is mandatory annual continuing education. The requirement is at least 8 hours a year of NMLS approved classes broken down into several parts: 3 hours of federal regulations, 2 hours of ethics, 2 hours of nontraditional mortgage standards, and 1 hour of mortgage origination topics. Check with the state where you hold your license to make sure you’re meeting any state requirements as well.

It’s also a good idea to get a certification. It’s not a requirement but it may help you in the future when you’re looking for employment or even if you want to advance in your current position. A lot of these certifications are done through the Mortgage Bankers Association with the Certified Mortgage Banker (CMB) being one of the most popular.

How to Obtain a MLO License Endorsement
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4 thoughts on “How to Obtain a MLO License Endorsement

  • July 10, 2019 at 12:20 PM

    Is it mandatory to be registered to be a mortgage loan officer? Can you work off of the banks license? Is registered and licensed the same thing?

    • July 11, 2019 at 9:31 PM

      All loan officers must be registered with the NMLS. You can work for a bank and not be licensed but must be registered, although most banks like you to be licensed as well.

  • November 15, 2021 at 1:00 PM

    Can you register and take the exam prior to finding a sponsor? Or must you have a sponsor in order to sign up for the exam?

    • December 1, 2021 at 7:04 AM

      Yes you can but you will need a sponsor to activate your license once all the course work and testing is done.


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