A and N Mortgage is Chicago’s premier mortgage banking firm. We employ some of the most renowned mortgage officers in Chicago and are ready to help new mortgage brokers navigate the mortgage lender license requirements in Illinois. This guide will walk you through the main steps required to obtain your license and will point out ways we can help.

First things first: what does a mortgage broker do?  Mortgage brokers serve as intermediaries between borrowers and lenders. Brokers will counsel a prospective buyer and complete and process their clients’ application to match them with a lender. But brokers won’t actually lend you money.  A mortgage lender, then, is the individual or institution (like a bank or credit union) that loans you the money to buy real estate.

Mortgage brokers and lenders work together to match buyers with the best mortgage product available for their situation. Mortgage brokers are also responsible for making sure that their clients will be able to pay back the mortgages that they take out. In light of the housing crisis of 2008, the role of mortgage brokers has become increasingly important, especially with regards to reducing the risk of default. 

The process of becoming a licensed mortgage broker is pretty straightforward. There are five main components of the mortgage banking license process: pre-license training, NMLS exam, bond issuance, registration, and annual renewal.

Although there are differences in bond amounts, fees, and specific registration criteria, the process of becoming a mortgage broker is largely the same in each state. To service clients in additional states, you’ll have to complete and adhere to the licensing requirements of that state. Since Chicago is what we know best, here’s what you need to do to obtain your mortgage broker license in Illinois:

• Pre-licensing Education: Every mortgage broker must have a high school diploma or GED and three years of field experience or 20+ hours of pre-licensure training at an approved institution.

 This mortgage broker training devotes time to federal law (three hours), ethics (three hours), non-traditional mortgage lending (two hours) and relevant electives, like financial regulations surrounding mortgages, loan officer ethics, mortgage origination, etc. (12 hours).

While it isn’t mandatory to have some fluency in finance, economics, or accounting, those skills help a great deal when it comes to examining product options and guiding your client. It is also a good idea to gain experience from a firm before striking out on your own as this can be a pretty aggressive business.

It’s important that you begin to build your network of clients and lending institutions. After all, your success relies heavily on your ability to connect both parties through the mortgage brokering process. Many new brokers choose to start out with established firms that have existing client and lender relationships.

To continue to provide the best loan product options to your customers, you need to stay on top of the available offerings. It also helps to have some general knowledge of relevant laws and legal procedures.

• The NMLS Exam: The NMLS (National Mortgage Licensure System) offers a test called the SAFE Mortgage Originator exam. You must pass this nationwide exam, and, if the state that you plan to register in requires it, the state-specific component, too. 

Passing means completing one or both tests with scores above 75%. The national test is $110, and the state-specific component is an additional $69. Keep in mind that applying for licensing in additional states will mean that you need to prepare to take additional state-specific tests.

The exams will test your knowledge and understanding of the rules and regulations that concern mortgages in your area. You can take this test at any time and must pass it before you can broker any mortgages.

• Apply for your License: The NMLS is an online platform that regulatory agencies use to streamline processing of licensing applications for various industries like mortgage brokering and mortgage lending.

Once you obtain the proper registration with the Secretary of State in Illinois, you’ll submit that information and relevant documents, like your background check and credit report, to the NMLS system for processing. From there, regulators will review your submissions and contact you directly if necessary.

The role of the NMLS is to coordinate, among other things, the mortgage lender licensing process. To do this, the NMLS serves as the central hub of information between agencies that regulate different financial services. In addition to mortgage lenders, money transmitters, check cashing establishments and currency exchange businesses use the NMLS as well. 

The NMLS is responsible for cross-checking all of the information in your application. As a mortgage broker, you will also use the NMLS to maintain your compliance documents and renew or update your license in any way. If you elect to practice in another state, you’ll use the NMLS to apply in that different state. The NMLS maintains checklists of the various state-specific requirements and facilitates and organizes the entire process.

• Issue Your Bond: Each mortgage broker must have a surety bond in place to operate. The amount varies by state, but here in Illinois, you need a $25,000 bond. 

You usually pay for this like insurance by paying for an annual premium based on your credit score and financials. This bond functions like insurance in a way—but for your clients, not for you. If you’re found guilty of any type of fraud, for example, or your clients suffer any type of financial hardship due to your mistake, this bond is their recourse.

• Pay your Fees: In Illinois, the mortgage broker licensing fees total $2800, which includes the NMLS processing fee. 

Once that’s done, you’re good to go – at least for a year. Mortgage lenders and brokers are required to renew their licenses annually and undergo constant training regarding new regulations, etc. Expect ongoing professional development to keep abreast of changes in the mortgage lending industry. 

Being a mortgage broker can be an incredibly fulfilling career. Many brokers enjoy the positive, personal impact that they get to make on their clients each day. Navigating the mortgage process can be complicated for first-time homebuyers. As a mortgage provider, this is a unique opportunity to provide service on such an important and fundamental level.

Ultimately, the best mortgage bankers and brokers are willing to go above and beyond, like our own Kiki Calumet, recipient of The Forbes Real Estate and Mortgage Market Leaders 2019 award. Kiki believes that “it’s about developing a relationship with clients naturally” and that “customer well-being is a priority.” Year after year, relationship after relationship, Kiki continues to excel in a field that she loves. 

Being a mortgage broker is personally rewarding, but the money isn’t bad, either! The PayScale website reports that mortgage brokers earn between $52,000 (average pay ) to $197,489 per year  These figures can vary due to a number of factors such as location and experience. As an independent broker, you’ll most likely earn a commission from each loan that you broker. If you join a brokerage firm, you might command a salary and benefits on top of your commission. 

As some of the most renowned mortgage officers in Chicago, we thoroughly understand the licensing process here in Illinois and are happy to guide you through the process. We can help make the understanding the mortgage lender licensing requirements and licensing process as smooth and worry-free as possible.

We’ll help you set up the necessary pre-licensing education courses and coordinate your background checks and fingerprinting as you work to complete the requirements for your NMLS application. When you’re ready, we can also help you schedule testing appointments.

 Conclusion

Becoming a mortgage broker can be an incredibly fulfilling career. There are few feelings that can match the satisfaction that comes along with helping a family purchase a home. At A and N Mortgage, we have worked hard to earn a reputation for being the best mortgage company in Chicago. Our team, from President Neena Vlamis on down, works hard to know the ins and outs of the mortgage business here in Illinois and the surrounding areas and offer the best products and solutions to our own clients.

From coordinating pre-licensing education to helping you schedule the exam and prepare other elements of your application, to advice on securing your mortgage broker bond, we’re here to help new mortgage reps fulfill their mortgage lender licensing requirements. The process is straightforward, but includes necessary safeguards, like constant training and stringent NMLS application details, to ensure that new reps are confident in their abilities to provide sound mortgage guidance to their customers.

Now that you know what the process entails, what are you waiting for? Get in touch with A and N Mortgage to set yourself on the right path to your mortgage broker career!