This blog will discuss and cover starting a new career as a MLO or a mortgage loan officer. Have You Considered Of Starting a New Career as a MLO or a Mortgage Loan Officer? Have you ever thought about starting a new career as a mortgage loan officer? A career as a mortgage loan officer is unlike any other job due to the complexity of the job and the hundreds, if not thousands, of case scenarios a mortgage loan originator often faces. Keep on reading:
In this article about starting a new career as a mortgage loan officer, I will detail what it entails to get your federal and state NMLS licenses and how to get started in starting a new career as a mortgage loan officer.
Any loan officer can qualify a mortgage borrower who has 800 credit scores, 40% debt-to-income ratios, perfect credit payment history, no prior late payments, no prior bankruptcies or foreclosures, no gaps in employment, no outstanding collection accounts, no judgments, no tax liens, no charge offs, and ample reserves and assets. However, that is not how the real world works.
Understanding Case Scenarios of Borrowers With Unique Credit and Income Situations
Hard-working Americans run into extenuating circumstances such as job loss, business, divorce, and medical issues that affect their credit and financial status. Mortgage bankers are direct lenders who fund the mortgage loans they originate and may or may not service the mortgage loans they fund. Mortgage bankers need to be licensed.
One of the most rewarding aspects of working as a licensed mortgage loan originator is that no two borrowers are alike. The job entails always learning new guidelines in different mortgage loan programs.
Depending on which mortgage company loan officers work for, you must know the federal minimum mortgage lending guidelines and be familiar with your employer’s investor overlays. This article will discuss Starting new career as MLO at Gustan Cho Associates.
Investor Overlays Versus Agency Guidelines
Overlays, also called investor overlays, are mortgage lending guidelines on top of the federal minimum lending guidelines each mortgage lender can impose. For example, many mortgage lenders have overlays on credit scores.
FHA only requires a credit score 580 to qualify for a 3.5% down payment FHA home purchase loan. However, a particular mortgage lender can have investor overlays requiring credit scores of 640 FICO or higher to qualify for FHA loans.
This holds even though the minimum required is 580. HUD does not require paying off outstanding collection accounts to qualify for FHA loans.
How Every Lender May Have Different Requirements on Government and Conventional Loans
However, most banks and lenders require that unpaid outstanding collection accounts be paid in full before they will approve borrowers. Gustan Cho Associates and its licensed loan originators specialize in helping borrowers with previous credit issues and higher debt-to-income ratios.
We have no overlays and normally go off the federal minimum mortgage lending guidelines. Many of our borrowers could not qualify at other banks and lenders and come to us, where we get the loan closed and funded.
We pride ourselves in customer service. Most of our borrowers become our lifelong friends. We are a growing group of mortgage professionals looking for quality, hard-working people to train and become part of our growing family. The first several files will be worked together with a senior loan officer.
First Step In Starting A Career as a MLO, or Mortgage Loan Officer
To start a new career as MLO, you must first get your federal NMLS license. Candidates must first contact NMLS Resource Center and register and get an NMLS number. The NMLS number is the loan officer’s permanent license number.
Candidates will need it to sign up for the 20-hour pre-licensing course, which is mandatory for all new mortgage loan originators.
There are actual classrooms and online courses for the 20-hour mortgage loan originator pre-licensing course. Prices vary between $200 to $500 depending on the school, and so do schedules. Some schools offer a three-day course, schools offer weekends only, schools offer night courses, and the most popular courses are online webinars.
Taking The Federal NMLS Exam
Once candidates have completed the 20-hour NMLS pre-licensing course, their next step is to take your national NMLS examination, which is a three-hour exam and consists of 125 questions. Candidates need at least 80% on the national NMLS test to pass the exam. There are many prep courses and practice exams that you can purchase to help you pass the NMLS national exam.
Starting A Career As A Mortgage Loan Officer And Licensing Requirements
After passing the NMLS Federal examination, you are eligible to get licensed. Again, candidates must log in to the NMLS Resource Center and apply for their federal NMLS license. The licensing process requires a thorough federal criminal background investigation, including fingerprinting and credit checks.
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Candidates will have a separate criminal background check for every state they apply for by the state’s law enforcement agency. Once candidates get clearance on criminal and financial background checks, their mortgage NMLS license will be approved. The next step will be to get hired by a mortgage company.
Career as a Mortgage Loan Officer: Banks Versus Mortgage Brokers Versus Mortgage Bankers
Once candidates get their NMLS mortgage license, their next step is to get a mortgage lender to sponsor and hire them. Those seeking employment with an FDIC bank or federally chartered credit union are not licensed and are exempt from licensing requirements. Some mortgage loan originators choose to work for a mortgage broker.
The Role of a Mortgage Broker
Mortgage brokers are third-party mortgage consultants who represent actual wholesale mortgage lenders and get paid a commission by the wholesale mortgage lender. Mortgage brokers do not fund loans and just broker mortgage loans.
The commission they receive is called a yield spread premium. Loan officers working for mortgage brokers need to be licensed. There will be dozens of different case scenarios.
No two mortgage applications will be identical, and you will never be alone on any mortgage file. Gustan Cho Associates, headquartered in Oakbrook Terrace, Illinois, is a national mortgage banking firm licensed in multiple states with a five-star national reputation.
Career as a Mortgage Loan Officer: Employment Opportunity at Gustan Cho Associates
If you are interested in a career as a loan officer with Gustan Cho Associates, please get in touch with us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at gcho@gustancho.com.
We aggressively hire experienced mortgage loan originators and select mortgage loan officer recruits. Neither party, whether the licensee of the GCA website or the administrator, can change usernames or passwords without notifying the other party.
We are looking for quality and not the number of loan officers. Candidates with at least one year of full-time loan origination experience and are a self-starter have come to the right place. We have remote loan officer positions available nationwide for those with at least one year of experience in full-time loan origination.
Career as a Mortgage Loan Officer: Applying For States After Passing The National NMLS Exam
Once the Federal NMLS exam is passed, candidates apply for their license with the states they want to get licensed. As mentioned earlier, the licensing process takes two weeks and covers federal criminal background checks, fingerprinting, credit checks, etc.
Once you get the licenses, we will send an employment package and application. Once it’s completed, we will send you an employment letter. We will then send you your credentials, including your Corporate email address, Encompass software, Credit Plus software,
Fannie Mae and FREDDIE Mac Automated Underwriting System software and all other programs needed to conduct business. Our IT department will guide all candidates and help set up everything. As new mortgage loan officers, candidates will be assigned to several senior mortgage loan officers for training.
Career As A Mortgage Loan Officer? How Do I Get Clients?
The products we deal with are in demand. Gustan Cho Associates is a full service mortgage banking company with a reputation for getting loans closed and getting home loans closed on time. We are licensed to originate and fund FHA, VA, USDA, Conventional, Jumbo, Reverse Mortgages, FHA 203k, Non-Warrantable Condominium, and Non-Conforming loans.
In the event of an exit, the exiting party will receive all accounts payable dated on and before the exit date. A separate agreement can be made after both parties and the exiting parties exit. However, this agreement will come to an end.
A new loan officer does not need to cold call. We will provide borrowers to every new loan officer recruit. With every new borrower, the new loan officer recruit gets, the loan officer will contact the home buyer’s realtor, home seller’s realtor, home buyer’s attorney, home seller’s attorney, and other professionals.
BUSINESS AGREEMENT EFFECTIVE XX, January, 202X: ALL PREVIOUS AGREEMENTS ARE NULL AND VOID. GOING FORWARD, ONLY WRITTEN BUSINESS AGREEMENTS ARE VALID AND EFFECTIVE
This agreement is between Gustan Cho and a New Member of Gustan Cho Associates, renewable year to year (every 12 months). A new agreement does not need to be written every year but needs to be signed and dated by both parties.
If no changes have been made, both parties can sign and date this agreement. If any modifications are made, they can be added to this original business agreement, and both parties need to initial the altered or new sections of the agreement.
Suppose additional associates or third-party vendors are part of this business agreement. In that case, the new member’s role, the scope of work, name, signature, and effective date of the agreement needs to be written in this agreement and initialed and signed by all active and new members of the agreement.
Partner’s Loan Origination Compensation As Independent Licensed Loan Officer
Both members agree you need to lead by example. Any personal loan origination as licensed loan officers will be paid ONLY as a GCA-provided comp plan, currently set at 75 basis points. It is up to the members to set up a separate agreement of getting either a personal assistant or mutually shared assistants such as LOAs and Mortgage Processors.
The equity position will reflect the profit and loss position starting at the executed date of the contract. Gustan Cho Associates and the assignee and licensee can mutually agree to a separate compensation agreement depending on their circumstances. For example, one member wants to take one year off due to traveling the world.
Both members can mutually agree the non-working member will take a profit cut to replace the duties of the member’s scope of work, like hiring a third-party vendor to perform the equity holder’s duties. No self-generated comp plan is currently set at 125 basis points due to not being fair to the partnership profit and loss.
Starting New Mortgage Career With Gustan Cho Associates
These new contacts can be future referral partners for the new loan officer. The borrower who closes their loan with the new loan officer will also give friends and relatives as referrals. Loan origination is voluntary and not the scope of work of this business agreement. However, if it affects the duties of the partners, each needs to reduce origination activities and concentrate on their scope of work under this business agreement.
As time passes and the new loan officer does more and more closings, the loan officer’s name will get branded, and the loan officer will develop a reputation. Our offices will help every loan officer recruit with marketing and business development.
You do not have to worry about starting and making money with our team. We are aggressively recruiting hard-working folks looking to start new careers as mortgage loan officers nationwide. Please get in touch with us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at gcho@gustancho.com.
