wikiHow to Be a Mortgage Broker

Three Parts:Obtaining a Mortgage Brokers LicenseWorking as a Mortgage BrokerProviding Superior Service

As a mortgage broker, you will be involved with a lot of decision making. You will be an integral part in the time-honored tradition of home ownership by helping individuals decide which loan to use when purchasing homes. Or, if you decide to work on the commercial side of real estate, you will aid businesses in picking their loans. Many brokers start out working for a firm to gain experience and build a client base, but some decide to work independently from the start. In any case, you will need to get a mortgage broker's license to practice your craft. Follow the steps below to get licensed, certified, and on your way to becoming a mortgage broker.

Part 1
Obtaining a Mortgage Brokers License

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    Meet the educational requirements. The only educational prerequisite for obtaining a mortgage broker's license is a high school diploma. That said, a successful mortgage broker will have an understanding of accounting, law, financial analysis, and business principles. To gain this type of knowledge, consider earning a college degree in a related discipline or taking classes from an online source like Coursera.[1]
    • You may also wish to take classes in advanced math, computer skills, and hone your research skills. These skills can help you succeed as a mortgage broker.[2]
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    Gain related experience. Many mortgage brokers get their start as loan officers or real estate agents. Either of these careers will help introduced you to the world of real estate and mortgages. They can also help you develop crucial skills like financial analysis and how to read real estate market trends.[3]
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    Determine license requirements. Whether you work for a firm or for yourself, you will eventually have to become licensed to be a mortgage broker. In order to find out the licensing requirements for your location, try looking at a national trade association such as the National Association of Mortgage Brokers (NAMB) in the U.S. or the Real Estate and Mortgage Institute of Canada. The Web sites of these agencies can provide you with a list of licensing information broken down by state or province.
    • To find your state's requirements, go to this website: Then, click on the state(s) in which you plan to practice as a mortgage broker for more information.
    • Gaining your license will require you to not have any felonies on your record over the past seven years, to not have a previously-revoked mortgage broker license, and to pass the Nationwide Mortgage Licensing System (NMLS) test with a score of 75 percent or higher.[4]
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    Prepare for the license test. Before taking the license test, which is called the SAFE Mortgage Loan Originator Test, you are required to take 20 hours of NMLS-approved education. These classes include an education in loan origination law, standards, ethics, and processes. Your specific educational requirements will depend on your state, so refer to the appropriate state agency's website for more information.[5]
    • Be sure to take a state-specific preparation class, as some of the test contains state-specific questions.[6]
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    Take the license test. You can sign up to take the test on the NMLS website. They also have a test preparation handbook ready for potential test takers. Pay whatever fees or take whatever tests are necessary to become licensed in the state or province where you would like to be a mortgage broker and then take the test. You have 180 days after signing up to take the test before your testing window closes.[7] Costs and requirements may vary by state. For example:
    • In the State of Arizona, it will cost you about $445 to participate in a pre-licensure education program. You'll learn through the Arizona School of Real Estate how to pass the state exam.[8]
    • Similarly, in the State of Washington, you must past the Washington Designated Broker test offered by the organization Pearson VUE. The Washington State Department of Financial Institutions works with the National Mortgage Licensing System (NMLS) to provide its licenses.
    • The NMLS allows an individual to become licensed in multiple states with 1 application. Most states either participate in the NMLS or are going to participate at some point.

Part 2
Working as a Mortgage Broker

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    Start working as a mortgage broker. With a current license for your state, you are now free to pursue work as a mortgage broker. From here, you can join a mortgage brokerage firm or go out on your own. By working on your own, you are required to create your own mortgage leads and get started in the business without any guidance. However, for the entrepreneurial person, this can be a highly rewarding way to get started.
    • Focus on building relationships with lender so you can get the best deals for your clients.
    • This allows you to compare many different loan offers to choose the best fit for each case.[9]
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    Meet bond requirements. Depending on the requirements of your state, you may be required to hold a mortgage broker bond. This is a type of surety bond that protects you from claims of fraudulent business practices. Each state that requires a bond has a limit that mortgage brokers are required to have. For example, Pennsylvania requires $100,000 worth of coverage and Alabama requires $25,000. Annual premiums for this type of coverage, however, are much lower than these amounts.[10]
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    Earn credentials. Agencies such as the National Association of Mortgage Brokers (NAMB) offer credentials that help brokers let potential consumers know that they have a certain minimum level of expertise. It is never too soon to get certifications; as with other fields, certification can assist you with getting a job with a broker group, or will help a consumer pick you out from the pack. There are 3 credentials available depending on your experience:
    • As a beginning broker, the GMA or General Mortgage Associate credential will help the most.
    • The Certified Residential Mortgage Specialist (CRMS) credential is for those with 2 years of experience.
    • The Certified Mortgage Consultant (CMC) is perfect for professionals with 5 years-plus experience.
    • Certifications last for three years and then must be renewed. Certifications are earned by signing up for and taking a multiple-choice exam once you qualify for the level of experience required.[11]
    • NAMB also offers continuing education courses to assist even the most savvy broker in navigating the newest lending options.
    • Monetary motivation is also a factor as certified brokers have a mean average salary of between $124,000 and $161,000, credential dependent. The mean average salary for non-certified brokers is around $100,000.
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    Keep up with continuing education. As of 2008, mortgage brokers are required to take continuing education courses each year in order to renew their licenses. These requirements vary by state, but generally include an 8-hour course with content similar to that of the original license test. Again, check with the relevant state regulatory body to find your specific requirements.[12]

Part 3
Providing Superior Service

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    Meet the specific needs of each borrower. Providing a high level of service is the surest path to earning repeat business and strong referrals. The best mortgage brokers provide tailored solutions to each borrower that comes into their office. This requires having relationships with 40 or 50 lenders so that you can choose from a range of different loan packages. Work with borrowers to determine their needs as far as loan amount, fee structure, loan duration, and monthly payment.[13]
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    Act as a financial planner. Extend your services by recommending certain courses of action based on your borrower's financial situation. Take the time to listen closely to each one and talk to them about their available courses of action. For example, how much should they put down? Is it worth it to put less than 20 percent down and buy mortgage insurance? Would it be advantageous for the borrower to buy discount points? The borrower won't have the answer to these questions, but you, as a skilled mortgage broker, will be able to provide them.[14]
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    Help borrowers lock in rates. Assist your borrower in choosing a lock-in rate and period, making sure they are getting the best rate. Explain the entire process to them and work on getting the lock-in through to the lender as fast as possible. Advise them at each step and then let them know as soon as the rate is locked in. By doing so, you come off as an honest broker looking out for your customers.[15]
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    Communicate clearly and effectively. Be absolutely clear about important details, like your fee, closing dates, and rate lock-ins. Make sure that your borrower always knows what is currently happening and what the next step will be. In addition, explain any terms that your borrower seems unclear about in layman's terms. Good communication will keep you in the borrower's good graces and earn you a reputation for being easy to work with.[16]

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