Ethan Riley
A mortgage banker, also known as a loan officer or mortgage broker, is a finance professional who helps clients secure mortgages by determining their financial needs and qualifying them for home loans. To become a mortgage banker, you must be at least 18 years old and have a high school diploma or GED, although a bachelor's degree in a finance-related field may increase your chances of securing a job. Additionally, you must complete pre-licensure courses and pass the NMLS/SAFE licensing exam. Some non-depository companies hire individuals with no prior experience and cover the costs of training, testing, and licensing. After gaining experience, you may choose to become an independent mortgage broker, allowing you to have full control over the lenders you work with and other aspects of the business. Obtaining a Certified Mortgage Banker (CMB) designation is also an option for those seeking the highest level of professional success in the industry.
| Characteristics | Values |
|---|---|
| Education | A high school diploma or GED is required. A bachelor's degree is preferred as it increases the chances of securing a job. |
| Courses | Courses in mortgage banking cover topics like mortgage brokering, federal and state laws related to mortgages, and mortgage origination. |
| Licensing | A Mortgage Loan Originator (MLO) license is required. The National Mortgage Licensing Service (NMLS) offers pre-licensure courses and accepts applications for licensure. |
| Exam | The NMLS/SAFE exam must be passed to obtain a license. |
| Experience | Gaining experience as a mortgage loan officer is beneficial. Working independently or with a mortgage lending company, bank, or credit union are options. |
| Certification | The Certified Mortgage Banker (CMB) designation is the industry standard for professional success. |
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What You'll Learn
Education and qualifications
A mortgage banker is a finance professional who helps clients secure mortgages by reviewing financial data and organising the best loan options for them. While some mortgage bankers may enter the field with only a high school diploma or GED, earning a bachelor's degree can increase your chances of securing a job by demonstrating your formal expertise in finance.
Before becoming a mortgage banker, you must first become a licensed loan officer. This involves registering on the NMLS website and completing mandatory 20-hour pre-licensing education through an approved provider. You can find these courses online or at colleges that offer specialty courses. These courses cover topics such as mortgage brokering and federal and state laws related to mortgages. After completing the pre-licensing education, you must pass the NMLS/SAFE exam.
Once you have fulfilled the education and licensure requirements, you can gain experience working as a mortgage loan officer. You can work independently or seek employment at an established mortgage lending company, bank, or credit union. As a mortgage loan officer, you will help clients determine whether they qualify for home loans, provide information on loan types and interest rates, and guide them through the process.
After gaining experience as a mortgage loan officer, you can pursue further qualifications, such as the Certified Mortgage Banker (CMB) designation, which is the industry standard of professional success.
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Licensing and exams
To become a mortgage banker, you must be licensed in the state in which you work. Licensing requirements vary by state, but they typically include pre-licensing education, passing a licensing exam, and a background check.
The Nationwide Mortgage Licensing System (NMLS) is a web-based system that allows mortgage professionals to apply for, amend, update, or renew licenses online. To get a mortgage license, you need to register with the NMLS. You will receive a unique NMLS ID to track your licensing progress and activity throughout your career.
The NMLS requires a mandatory 20-hour pre-licensing training course, which costs between $200 to $300. After completing the course, you can take practice tests provided by NMLS-approved schools to prepare for the exam.
Once your education is complete, you must pass the SAFE MLO Exam, a national test required for all state-licensed MLOs under the SAFE Act. The SAFE Mortgage Loan Originator Exam is divided into two sections: the national component and the state-specific component. You must score 75% or higher on the exam.
After passing the national test, you may still need to meet state-specific licensing requirements, such as additional testing and background disclosure. Check your state’s requirements for the most accurate and updated information.
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Career progression
To become a mortgage banker, you must first complete your high school education or obtain a bachelor's degree. While in school, it is beneficial to take math- and finance-based classes to gain a basic understanding of the skills required for the role.
Once your foundational education is complete, you should look for a class in mortgage banking to prepare for the daily operations of the role and the licensing exam. These courses can be found online or at colleges that host specialty courses. During this course, you will study topics like mortgage brokering and federal and state laws relating to mortgages.
After completing the course, you will need to pass the Mortgage Loan Originator (MLO) licensing exam. This exam is mandatory for anyone wishing to become a mortgage banker, and it covers both federal and state mortgage lending laws.
With your license secured, you can then begin working as a mortgage banker. Your first job in this field may be with an established mortgage lending company, bank, or credit union. Alternatively, you can choose to work independently. As you gain experience, you may decide to become an independent mortgage broker, which allows you full control over the lenders you work with, pricing, processing, products offered, and fees.
To further advance your career and be recognized as achieving the highest level of professional success, you can strive to earn the Certified Mortgage Banker (CMB) designation. This certification is the industry standard, symbolizing respect, credibility, ethics, and achievement within real estate finance.
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Job duties
A mortgage banker is a finance professional who helps clients secure mortgages by reviewing financial data and organizing the best loan options for them. Some common job duties for a mortgage banker include:
Meeting with clients
Discussing clients' mortgage needs and helping them choose the best loan for their financial situation. Mortgage bankers need to be well-versed in the different types of loans available and interest rates to best serve their clients.
Reviewing financial records
Evaluating loan applications by collecting and reviewing borrowers' financial information, including taxes and debt. This involves maintaining detailed and accurate records on mortgage transactions.
Coordinating with other professionals
Working with other real estate professionals, such as home appraisers and underwriters, to ensure a smooth mortgage application process.
Complying with regulations
Adhering to confidentiality policies and privacy laws throughout the mortgage application process. Mortgage bankers also need to comply with federal and state laws related to mortgages.
Managing loans
Originating and servicing mortgage loans, including collecting payments and managing escrow accounts. This involves keeping the loan origination process on track and providing clear communication to clients.
Selling loans
Selling mortgage loans to other financial institutions is also part of a mortgage banker's role.
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Salary expectations
Mortgage bankers, also known as loan officers or mortgage brokers, help clients secure mortgages by advising on the best loan options for their financial situation and helping them through the application process. While some mortgage bankers build their careers with only a high school diploma or GED equivalent, earning a bachelor's degree in a finance-related field may increase your chances of securing a job and could lead to higher earning potential.
The salary for mortgage bankers varies depending on their specific role and experience level. Mortgage loan originators, for example, earn an average base salary of $162,095 per year, with an additional average commission of $27,600 per year. Loan officers, on the other hand, earn an average base salary of $169,030 per year, with an average commission of $24,000 per year.
It is worth noting that banks typically have a higher base pay but less favourable commission structures compared to other mortgage companies. Additionally, independent mortgage brokers have more control over their lenders, pricing, processing, products offered, and fees, which could impact their earning potential.
To become a mortgage banker, you must first complete the necessary education and licensure requirements. This includes taking pre-licensure courses, such as the 20-hour training course to prepare for the NMLS/SAFE licensing exam. After passing the exam and gaining some work experience, you can explore opportunities with different companies or choose to become an independent mortgage broker.
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Frequently asked questions
You will need a Mortgage Loan Originator (MLO) license to become a mortgage banker. To get this, you must pass the NMLS/SAFE licensing exam. Before taking the exam, you will need to complete a 20-hour pre-licensing course.
A mortgage banker is a specialised finance professional who helps clients secure mortgages. They meet with clients to discuss their mortgage needs, help them choose the best loan for their financial situation, and originate loans by evaluating applications and reviewing financial records.
While many mortgage bankers have only a high school diploma or GED equivalent, you may want to consider getting a bachelor's degree in a finance-related field. This is because a college degree can increase your chances of securing a job and show that you have formal expertise in finance.
Mortgage bankers often work for financial institutions that provide loans to clients, so their job involves reviewing financial data and organising the best loan for each client. Mortgage brokers, on the other hand, are independent and have more control over which lenders they work with, pricing, processing, products offered, and fees.
