How to Become a Loan Officer or Mortgage Broker in New York
There is a distinct difference between mortgage brokers and mortgage loan officers, though some people confuse the two. A mortgage broker matches borrowers with a loan from a number of lenders they work with. Loan officers originate loans by finding clients and initiating the application process.
Some loan officers work for mortgage brokers, while others work for direct lenders. Mortgage loan officers are typically 100 percent commission, receiving a percentage of the origination fee and loan profit. In New York State, both mortgage brokers and loan officers must be licensed and generally need to be a loan officer (originator) first.
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Instructions
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Work for a mortgage lender or broker or get a job offer from one as a loan originator (officer). You cannot get a mortgage loan originator (MLO) license from the State of New York without this. Loan processors or underwriters do not need this type of license.
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Submit an application through Nationwide Mortgage Licensing System (NMLS), which allows it to do a background check on the state's behalf. Applications include submission of fingerprints and a credit report including your credit score, along with a signed affirmation statement that the information is true and you will promptly notify NMLS if there are any changes in the information. As of November 2010, the total cost of the application process is $330.50.
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Complete 20 hours of pre-license education from an NMLS-approved source with a passing grade. This education includes three hours of ethics, two hours of non-traditional mortgage lending, three hours of federal law, three hours of New York State-specific course content and nine hours of additional elective courses. Find the list of approved sources on the NMLS website. There is a fee for these courses.
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Take the SAFE Act test, which is the licensing exam consisting of national and state content questions. You must get a minimum grade of 75 percent on both the state and national portions of the test. The fees are due at the time of test registration and total $161, as of November 2010.
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Purchase a surety bond, if one is not provided by your employer, which guarantees performance in case you default on your obligation to the borrower. Your employer may charge you a monthly fee for coverage under his bond. Regardless of whether you hold an individual bond or are covered by your employer's bond, you must complete and submit documentation to the state banking department proving you are covered.
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Tips & Warnings
To become a licensed mortgage broker in the state of New York, you must follow the same procedure with some additional qualifications, including a business license and a line of credit of at least $1,000,000 from an unaffiliated bank or insurance company.
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