THREAD_GAME:

Getting licensed in the mortgage industry.

I promised this thread once I surpassed 3,000 followers, and here I am sitting pretty (fairly - I deserve more) at over 4,000.

Loan Origination is lucrative, but not any schmuck can do it.

You have to be LICENSED.

...

Why is licensing a requirement?

Because of the horrendous amount of fraud committed back in 2008, that's why.

But don't worry.

Getting licensed is only a small part of life as a loan originator.

Closing is the most important part.

But you can't close if you're not licensed.

This isn't always true, however.

There are some cases where you don't have to be licensed in order to originate loans.

This all depends on what kind of bank/lender you work for.

Non-banks require licensing.

Banks do not.

What's the difference?

Sinple.

Banks = Accept deposits.

Non-banks = Do not accept deposits.

We're talking checking and savings accounts here, people.

If you work at a bank, you're a REGISTERED Loan Officer.

Non-bank?

LICENSED.

I've never worked at a bank before, but Loan Origination is the same no matter where you are.

Banks are regulated in an entirely different manner than Non-Banks, which is why they don't require licensing.

Today we're going to talk about getting licensed as if you were going to work at a Non-Bank or a broker.

When you hear Non-Bank, think Non-Depository.

When you hear Non-Depository, you're basically talking about a mortgage company.

The great barrier to entry for employment as a LO is the job interview.

You need to convey a certain level of confidence and potential for success as a salesman to be able to make it through that gate, at least if you're interviewed by someone worth a damn.

I've seen far too many FUCKHEADS get hired and do a shit job, but mainly because the person hiring was a fuckhead to begin with.

However, just because you've been hired doesn't mean you should start celebrating just yet.

Your ass needs to get licensed.

And in order to that you have to do a number of things:

- Pass a credit check
- Pass a background check
- Pass the Uniform Standard Test (UST)

A credit and background check, you say?

Absolutely.

Remember, the licensing system, called the Nationwide Mortgage Licensing System (NMLS) was established as a result of the great crash of 2008.

There were far too many inscrupulous and shady individuals in the space (much like Twitter, heh), and so the licensing system was established to prevent those shady bastards from being able to originate ever again.

Fun fact: A lot of those shady fuckers are still industry.

They're just not originating.

But that's another story for another day.

So, you got hired, you're all excited, but you still need to pass the Big Three.

The NMLS and the governing bodies are really trying to screen potential candidates for a history of FRAUDULENT behavior.

You felons out there still have a shot, provided your felony wasn't related to defrauding individuals.

A buddy of mine is a felon and still originates, but he punched an undercover cop after a baseball game while he was drunk.

He didn't rob a sweet old lady blind, you see.

Most of you won't have to worry about this, because you're such an upstanding citizen already (right?).

The next hurdle?

Credit.

Some states require that you have a sufficient enough credit score and profile to be deemed worthy of dealing with money and negotiating loans.

You can't give out quality financial advice with a shit credit history, don't you think?

And then there's the test.

The Uniform Standard Test is the big elephant that people worry about passing.

Fortunately, your employer will pay for your testing.

But, if you fail enough times, your ass is out.

Why would they continue paying for a Loan Officer who can't even pass the test?

Most companies will give you one shot at the exam, but some others will keep you employed until you pass.

But you'd better be worth the investment.

Thing is, the current version of the UST is a fucking cakewalk compared to what it used to be.

I took the earlier version of the test back in 2010 and had to retake it to continue my licensing back in 2015 or so.

The 2010 test was a monster.

The newer version was easy.

If you can't pass the new version of the test, you're a fucking idiot.

There's no other way to put it.

The barrier for entry is significantly lower than what it used to be, but it's mainly because some faith has been restored in the lending space.

This is a good thing.

The test is far different than what it used to be.

Back then, it was basically like taking a law exam.

Very, very, difficult.

SO many LO's used to fail the exams.

But, rest assured, it's easier now.

The main thing the test consists of is testing your knowledge of:

- Mortgage law
- Mortgage guidelines
- Mortgage ethics

There's a primary focus on law though.

Why?

The crash, remember?

It's essentially to screen out the unscrupulous characters.

To pass the exam, you need to score a 75% or greater.

To take the exam, you have to go to a testing center, which your company typically pays for.

You have to provide a valid ID, and you'll take the test in a highly monitored environment to ensure no cheating takes place.

One of the great things about the UST is that passing the exam automatically means you're eligible for licensing in a number of states that have adopted the new format.

Before, you had to take an individual state test to be licensed in its respective state.

I had to take 17 of those bastards, including the national, and that was when they were the HARDER versions of the test.

Once you pass, and assuming the rest of your credentials check out, you'll get licensed in a few weeks.

The process has become far more efficient over time, and getting licensed takes much less time than it used to.

And then you're on your way.

You'll have to attest to the fact that you've never been committed to a crime, and all that jazz.

Some states require that you get your fingerprints taken.

I've had to do that a few times.

They don't fuck around, some states.

I forgot to mention, that before you take the exam, you'll have to take a 20 hour course, which is expensive, but your company will typically pay for it.

Sometimes, they won't hire you unless you've already taken the course and passed the exam.

Fortunately, courses aren't too terribly expensive, and neither is the exam itself.

It's just more of hassle.

After all that, you're done.

You'll have to take an 8 hour course every year and continue to pass the exams in order to stay licensed.

I've been doing them for the past 9 (going on 10) years now.

Company has always paid for it.

You WILL have to report any and all kinds of misdemeanors to the NMLS in order to maintain your licensing.

If you spend a night in jail for over drinking in public, expect to hear from them and have to provide an explanation as to what happened.

Speaking from experience...

So there you go.

A long overdue, but HOLY SHIT SO AMAZING thread on getting licensed.

Now, fuck off.

Do it.

@TheCloudSaint Done.