How To Be a Mortgage Broker (and Why)
How To Be a Mortgage Broker (and Why)

How To Be a Mortgage Broker (and Why)

The United States loan brokers industry is valued at $7 billion as of 2021. The industry, which has over 10,530 businesses, currently employs well over 36,000 Americans.

At the center of this lucrative industry are mortgage brokers. These professionals help make the mortgage process easier for homebuyers.

If you’ve been considering a career in the mortgage brokers sector, now’s a good time to take the plunge. The US housing and lending markets have continued to experience strong economic growth over the years, and that’s good news for mortgage brokers.

Wondering how to be a mortgage broker? You’ve come to the right place. This comprehensive guide has all the information you need to kickstart your mortgage broker career.

What Is a Mortgage Broker?

A mortgage broker refers to a licensed professional who acts as the middle person between prospective home buyers and mortgage lenders.

Mortgage brokers also work directly with homeowners who wish to refinance their current mortgages, helping them connect with mortgage lenders who are the perfect fit for their financial needs.

What Does a Mortgage Broker Do?

As a mortgage broker, your job is to educate your clients on the mortgage environment and process. You also provide your clients with the assistance they need to find the ideal home loans for them within the shortest time possible.

Mortgage brokers also play a role when it comes to rate shopping. This refers to the process of applying for mortgage quotes and mortgage pre-approvals with different conventional and reverse mortgage lenders.

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Once they’ve done this, they then present the offers you get to your client so they can make informed decisions regarding what’s available.

Why Should You Become a Mortgage Broker?

Many benefits come with pursuing a mortgage broker career. These include:

The Potential to Earn High Income

One of the first things you want to know before becoming a broker is what mortgage broker salary to expect. On average, US mortgage brokers earn $92,262 annually, although this figure can vary significantly based on geographic location and level of experience.

Mortgage brokers typically charge a commission for every loan. That commission averages around 2.25% and cannot exceed 3% as per federal regulations. As a broker, you can also charge fees based on your agreement with the client.

How To Be a Mortgage Broker (and Why)
How To Be a Mortgage Broker (and Why)

Job Autonomy

As a mortgage broker, you don’t need to spend your workdays behind a desk. You don’t even need to worry about having a boss watching over your every move.

Even when you choose to work for another institution, you usually enjoy a high level of autonomy that is unavailable to people in other jobs.

Flexible Working Hours

Mortgage brokers enjoy highly flexible working hours, especially when you operate your own mortgage broking business. That’s especially beneficial for brokers with other commitments besides work, such as pursuing further studies or raising a young family.

Of course, there may be weekends and evenings that you need to work, but that’s made up for by the weekdays you’re free.

The Chance to Help Others

Owning a home remains the biggest American dream. As a mortgage broker, you get to help numerous people achieve this dream by guiding them through the mortgage process, which is one of the biggest hurdles for first-time applicants.

How to Be a Mortgage Broker

Now that you’ve seen the benefits of becoming a mortgage broker, chances are you’re interested in becoming one. We’ve prepared a step-by-step guide to help you through the process.

Take the Pre-Licensure Course

Every mortgage loan broker needs to be licensed. The first step is to complete a pre-licensure program, which covers the relevant state and federal laws around mortgages. The program also deals with the financial regulations related to mortgages.

Aspiring mortgage brokers also learn about loan officer ethics, as well as mortgage origination. The pre-licensure program is administered by the National Mortgage Licensure System (NMLS). Y

You can check the NMLS website to learn or licensure programs near you.

Pass the NMLS Test

At the end of the pre-licensure course, the NMLS administers a test referred to as the SAFE Mortgage Loan Originator Test. The test is the same for every candidate. However, there’s a portion of the test that’s unique to the candidate’s region’s rules and regulations on mortgages.

Candidates can choose to take the NMLS test anytime they wish. As soon as you pass the exam, you can start brokering mortgages.

Start Working

Now that you’ve completed and passed the NMLS test, you can start to broker mortgages. Keep in mind that success in mortgage broking relies heavily on connections in the industry. That’s why it’s a smart idea to get your first job at an established brokerage institution.

Later, when you’ve gained considerable industry experience, you can opt to open your own brokerage firm.

Pursue Further Education on Mortgage Broking

Getting your mortgage broker license shouldn’t signal the end of your learning on lending. Top mortgage brokers are always on the lookout for opportunities to learn more and keep up with new trends in the industry.

Each year, you’ll need to spend some time on continuing education programs to keep your license current. Other professionals, including doctors, lawyers, and accountants, do the same.

The idea is to do your work accurately and offer the most current loan information to your clients.

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Build a Thriving Career as a Mortgage Broker

Now that you know how to be a mortgage broker, it’s time to take the first steps in launching your career. With the American real estate industry expanding each year, the services of mortgage brokers are in demand now more than ever before.

Not only do you stand to make a lucrative income, but you also help bring joy to the hearts of clients by making the mortgage loan process easier for them.

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