Becoming a mortgage loan officer is a promising career path that offers unlimited earning potential. Here is everything you need to know
Becoming a mortgage loan officer is a promising career path that offers unlimited earning potential, flexibility, and career growth. And this is certainly the case in Texas. In the Lone Star State, you can make more than $150,000 in your first couple years alone, plus commission (in some cases) over $20,000.
But how do you become a mortgage loan officer in Texas? What are the educational and on-the-job requirements? And how long does it take to become a loan officer?
In this article, we will answer these questions and more. Here is everything you need to know on how to become a loan officer in Texas.
How to become a loan officer in Texas: what are the requirements?
To be a mortgage loan officer in Texas, you will need to complete six steps. Some of these steps include enrolment in Texas Pre-Licensure Education (PE) and licenses from the Texas Department of Savings and Mortgage Lending (Texas-SML) and the Texas Office of Consumer Credit Commissioner (Texas-OCCC). Let’s take a quick look at the requirements on how to become a loan officer in Texas:
- Request an NMLS account
- Finish NMLS-approved pre-licensure education
- Pass SAFE (Secure and Fair Enforcement Act) mortgage loan officer test
- Complete state/FBI criminal background checks
- Finish NMLS application
- Get employer sponsorship
Let’s take a closer look at each of the steps:
1. Request an NMLS account
Before you start the educational portion of licensing, you must create a Nationwide Multistate Licensing System and Registry (NMLS) account on the State Mortgage Registry website. The NMLS is a nationwide database where all mortgage loan officers in Texas must register.
After creating your account, you will receive a personal NMLS number you will have for the entire time you are a working mortgage loan officer.
2. Finish NMLS-approved pre-licensure education
The two different NMLS licensing agencies in Texas are the Texas-OCCC and the Texas-SML.
Licensure with Texas-OCCC requires you to complete 20 hours of pre-licensure education. Licensure with Texas-SML requires you to finish 23 hours of pre-licensure course work.
Here is a breakdown of the education requirements of each:
Texas-SML
To meet the educational requirements, you must finish 23 hours of coursework which include:
- Federal law: three hours
- Ethics: three hours
- Non-traditional mortgage lending: two hours
- General electives: 12 hours
- Texas-specific defined electives (required by the SML): three hours
Texas-OCCC
To meet the educational requirements, you must finish 20 hours of coursework which include:
- Federal law: three hours
- Ethics: three hours
- Non-traditional mortgage lending: two hours
- General electives: 12 hours
Each of these courses is a requirement of the Texas-OCCC.
3. Pass SAFE mortgage loan officer test
You can visit the NMLS website to schedule the SAFE mortgage loan officer test. You can use your existing account number to schedule the test. It has 115 scored questions, and you must answer at least 75% correctly. The test costs $110 to take and you are given three hours and 10 minutes to finish.
4. Complete state/FBI criminal background checks
When applying in Texas, you need to log into your NMLS account and visit the “filing” section, then click on the “criminal background check” tab. By clicking attest, you will authorize a Federal Criminal Background Check.
The next step is to schedule an appointment to submit your fingerprints. You can do this by clicking the “fieldprint” button. These state and FBI criminal background checks cost $36.25 total.
5. Finish NMLS application
To submit for official Texas licensure, you must apply through the NMLS licensing portal. To ensure you are ready to apply, you should review the appropriate mortgage loan officer “new application” checklist:
License and application fees apply to each type of license. The Texas-OCCC license costs $325 while the Texas SML license costs $45. Depending on which license you pursue, you will only have to pay for one of the two license fees.
6. Get employer sponsorship
Until your employer sponsorship is verified with the NMLS, your Texas mortgage loan officer license will remain in pending status. The required verification is completed in the NMLS portal. After following the directions in the portal and completing the checklist, you will send your sponsoring employer notice of the verification request so they can approve the sponsorship. When it is approved, you will be officially licensed.
For general guidelines on how to become a loan officer (not just in Texas), read our article on how to become a mortgage loan officer in 10 steps.
How to become a loan officer in Texas: salary
The average mortgage loan officer in Texas gets paid a base salary of $197,452 per year, according to Indeed.com. The average commission for a mortgage loan officer in Texas is $11,750. The following chart is a breakdown of salaries by years of experience in Texas:
How to become a loan officer in Texas: commissions
How much a loan officer makes depends on where they work. Some mortgage loan officers make a flat salary, while others make a salary plus commission. Typically, commissions are tallied according to Basis Points, or BPS, per loan. For instance, BPS could break down like this:
1 BPS = 1/100 of 1%
This means, for example, that at 25 BPS for a home loan of $200,000, you would make a commission of $500.
In Texas, you could make an average commission of between 100 and 150 BPS, even as a new mortgage loan officer. Generally, however, the more you prospect for your clients, the higher your commission will be. Put simply, your commission will likely be much higher if you work for a boutique agency or alone compared to working with large financial institutions like banks or credit unions.
According to Indeed.com, you could earn a commission of $20,400 as a mortgage loan officer in Texas.
How to become a loan officer in Texas: how do I start?
No matter where you are applying to be a mortgage loan officer—Texas or elsewhere—you must register with the National Mortgage Licensing System and Registry (NMLS). You then must finish 20 hours of pre-licensure education courses and pass the NMLS mortgage license exam, among other requirements specific to your state.
After fulfilling these requirements, you can usually gain expertise while on the job. One great way to set yourself up for success is to join an independent mortgage broker shop. If you are new to the mortgage industry, you can also try to land a job as a loan officer assistant. This will help you learn the origination process and earn valuable experience, before finishing your license requirements.
How long does it take to become a loan officer in Texas?
The time it takes to become a loan officer in Texas will depend on what kind of schedule works best for you and how quickly it takes you to complete the licensing requirements.
Usually, it will take 45 days to complete the requirements to become a licensed mortgage loan officer, whether in Texas or any other state. But since every state has unique requirements, the number of days can vary. It also depends on your ability to pass the required background checks and exams.
Mortgage loan officers are essential to the mortgage industry, helping families and business owners along their way to purchasing the property that will make their dreams come true. While there are stresses that come with the job, there are also many perks and benefits.
If you're truly interested in becoming a mortgage loan officer, take the time to look at the mortgage professionals we highlight in our Best of Mortgage section. Here you will find the top performing mortgage professionals, including mortgage loan officers, across the USA.
Any questions on how to become a loan officer in Texas? Let us know in the comment section below.
