How To Get Your Mortgage License Part 2 | 3

Introduction to Mortgage Brokerage

In this video, the speaker discusses the benefits of opening a mortgage brokerage and the three main licenses required to become a mortgage broker owner or loan originator.

Benefits of Opening a Mortgage Brokerage

• The resources available for opening a brokerage have improved since 2017.

• Brokers currently originate one in every five loans in the U.S.

• You can operate as a one-person brokerage, team leader, or build a large brokerage.

Three Main Licenses Required

• License #1: Individual NMLS (MU2 form)

• Required pre-licensing course and exam

• Allows you to originate mortgages for consumers

• License #2: Company or MU-1

• Assigned to your company

• Required for opening your own mortgage business

• License #3: Branch NMLS

• Required by some states at every location

• Can be confusing if owner is not licensed

Applying for Company License

• Retrieve list of items needed for company license application from NMLS login.

• Most common requirements include:

• Background check and fingerprints

• Personal financial statements

• Business plan and pro forma (in some states)

• Resume

Steps to Obtain a Company License

In this section, the speaker outlines the steps required to obtain a company license.

Obtaining a Certificate of Good Standing and Organizational Chart

• A certificate of good standing for your business entity is required.

• An organizational chart must be prepared.

• Electronic security bond letters of explanation are available on the NMLS website.

Submitting Formation Documents and Business Entity Creation

• Formation documents such as Articles of Incorporation and operating agreement must be submitted.

• Partnership agreements are required for partnerships.

• Business entities can be created by going to an attorney or using state websites or companies like My Corporation.

Financial Statements, Pro Formas, and Bonds

• Companies can file and complete licensing steps for you but financial statements and pro formas must still be submitted.

• A bond is required to protect customers. The amount is determined by the state.

• Companies provide bonds like insurance policies.

Additional Requirements

• Criminal background checks are mandatory when submitting for company license approval.

• Prelicensing 20-hour courses and test results must also be submitted.

• Tax returns or tax certifications may also need to be provided if applicable.

DBA, Citizenship Status, Resume, and Books & Records Location Request

• Doing Business As (DBA) documents may need to be filed if using an established business under a different name.

• Citizenship status needs to be shown along with alien status if applicable.

• Resumes will disclose how long you have been in the industry.

• Some states require books & records location requests which may require research.

Assistance with Licensing Process

• Paying for assistance in submitting items can help save time especially if limited on time or nervous about something.

• There are companies that help with licensing for a charge.

Conclusion

In this section, the speaker concludes by providing additional resources and answering a common question.

• A checklist for opening your own brokerage is available in the description.

• Waiting times vary by state after submitting all required documents.

• Companies can help with licensing for a charge.

• The cost of applying for a company license varies by state.

State Licensing Costs

In this section, the speaker discusses the costs associated with obtaining a state license for insurance.

State Checklist and Licensing Cost Breakdown

• To obtain a state license for insurance, you can click on the state of interest on a map to pull up each state's checklist and licensing cost breakdown.

• The licensing cost breakdown for most states includes a surety bond, which is typically around $500, and a registered agent fee of around $100.

Application Fees

• In some states like Pennsylvania, the application fee for obtaining an insurance company license is around $1,100.

• Additionally, fingerprinting fees are required in some states and can add up to about $600.

• It's important to note that these fees do not include the cost of taking the 20 hours of required coursework or taking exams for individual licenses.

Branch Licensing Differences

• The third video in this series will cover branch licensing and how each state may have different requirements.

• The speaker will compare two states side by side to highlight some of these differences.