How to Become a Loan Officer

A loan officer (LO) is the person who initiates the loan from the loan corporation. If the LO is employed by a banking enterprise or some other financial firm, the LO will do their best to sell a loan from that source. Now if the LO is within a real estate agency, they will comb around looking for the best loan a client qualifies for.

Application                                                                                           

The first thing someone needs to do to become a LO is to apply for a loan originator license. This is necessary because more than half the states in the U.S. invoke certain protocols to be a loan originator. Which states make obtaining this license mandatory? One should look into Nationwide Mortgage Licensing System and click on the heading: State Licensing Resource Page for this information.

Test Preparation                                                                                                 

Since most states demand this license is necessary, we will act accordingly and assume one resides in a state that mandates a license is obligatory. If one feels they may need additional training or if they are completely new to this field, one should sign up for loan originator courses. There are multiple options to engage this training, either on site or virtual – online. This information can be located on the Department of Finance’s website pertaining to one’s state.

Test Time                                                                                                  

This is the moment of clarification. Hopefully one has understood the material presented to them in the classes. If not, one should retake the classes and/or continue to study the literature coinciding with being a loan originator. If one feels they have taken the appropriate precautions in regards to this loan originator test, the test should be taken without delay. The Department of Finance has the information required to see how the tests are administered.                                             

Locating Employment                                                                             

Assuming one has surpassed the test, now it is time to locate positions. Remember, the test one just passed is linked to that state, so one most likely cannot obtain a position as a loan originator outside of that state. It is possible to branch out and be an independent Loan Originator but most likely one may want to gain some hands on experience prior to this next step.

Sales Call                                                                                               

Did one think they were getting into sales with this position? Locating and finding customers is the only method a loan originator can derive a source of income. After meeting a customer, the loan originator passes this person to the lender. The top priority is attracting customers.

Buffer One’s License                                                                      

When a loan originator receives their license, it is conditional, like most other things. It is not a guarantee for life. One should consider taking continuing educational courses in this field. Many states mandate this as well as forcing their loan originators to renew their license. Why wait to the last minute to either renew one’s license or study the material one has not read up on since they first entered this field? Many states make it official that continuing education in this field is a requirement.