With the current state of the U.S. economy, there are many people on the job market looking to further their skills and pursue a new, more lucrative career. Countless people are coming to realize that technical skills and a specialized field are reliable pathways to success.

One of these pathways is becoming a loan originator. This specialized field helps people realize their dreams of owning a home or a new car while creating networking potential within the financial services industry. Many loan originators eventually move on to successful careers as private mortgage brokers or banking officers, and some loan originators simply climb to the top of their field to become exemplary loan originators in their territories. Since people are always seeking loans, the market for loan originators is relatively stable and the possibility of commissions means that loan originators can effectively write their own paycheck.

Like any specialized and technical field, becoming a loan originator involves a strict, federally regulated process. Our team at the Capstone Institute has compiled a list of the steps you need to take in order to become a full-fledged loan originator:


Review Your State’s Loan Originator Requirements

In order to become a loan originator, you’ll need to gather resources and review the requirements for your state. The Nationwide Mortgage Licensing System (NMLS) provides checklists of the requirements to become a loan originator in each state. Once you’ve reviewed your state’s licensing requirements, you’ll need to complete the necessary education and training programs.


Work at a Mortgage Company or Financial Institution

It might sound strange, but you’re going to need employment before seeking your official loan originator license. Your employer will act as your sponsor during the loan originator process, and they’ll be able to vouch for you during this time. According to the NMLS, applicants without an employer sponsor “will be administratively withdrawn as incomplete.”

Since it can be difficult to find a high-ranking position in a financial institute without a license, it’s often recommended to apply for a lower-ranking position, such as a loan officer, teller, or office assistant. After gaining a few months of experience, you can tell your employer that you wish to become a licensed loan originator and ask for their sponsorship. Your employer may also be able to provide you with more information about the loan originator process.


Take Mortgage Loan Originator Courses

To become a loan originator, you must first complete 20 hours of NMLS-approved education courses. At the Capstone Institute, we offer online and in-person courses that prepare you to take the SAFE test. Passing the SAFE test will allow you to apply for jobs as a loan originator. When you’re ready to take your career to the next level, you can also consider becoming a certified mortgage loan originator, which requires a few extra steps.


Fill Out Your NMLS Registration Forms

Before you can begin working as a mortgage loan originator, you must register with the NMLS. You’ll also need to complete Form Mu4R or Form MU4, depending on whether your financial institution has FDIC backing. Your employer sponsors will also need to sign off on the forms. Once you have registered, you’ll be assigned an NMLS number. While the registration process can seem daunting, it becomes relatively straightforward with a little preparation. By taking the time to register with the NMLS, you’ll be ensuring that you comply with all state and federal regulations.


Apply for Your Official Loan Originator License

The final step is actually applying for your official licensure from the NMLS. As a component of this application, you will need to supplement it with a few documents including

  • A criminal background check
  • An official fingerprint submission to the FBI database (depending on your state)
  • A credit check
  • Disclosure report
  • Verification of Lawful Presence within the United States
  • Any jurisdiction-specific forms such as an oath of conduct


Start Your New Career as a Loan Originator

Now that you’ve obtained your loan originator license, it’s time to start your new career as a loan originator. Depending on your employer’s preferences, they may want you to continue working for their company or you may want to quit and become a freelance loan originator. As a freelance loan originator, you’ll be able to locate your own leads and file your own requests to underwriters. If you decide to work at a financial institution, they’ll have their own policies and guidelines for you to follow. Regardless of your career path, you’ll have a new sense of independence compared to other professions.

If you’re interested in becoming a loan originator, the Capstone Institute has all of the training courses and resources you need to succeed. Whether you take our in-person or online courses, our instructors have invaluable experience in the mortgage industry, so you can start your new career off on the right foot. For more information on the Capstone Institute or to learn more about becoming a loan originator, contact us today.