How to Become a Mortgage Loan Officer (MLO) in California

Are you interested in becoming a mortgage loan officer in California? 

Often referred to as MLOs in the industry, these officers play a massive role in home buying. 

They assist buyers in finding loans that are suitable for them. They also prevent the proliferation of mortgage fraud and foreclosures. 

As you can see, it’s both a lucrative and fulfilling career. 

But how do you become a mortgage loan officer (MLO) in California?

We’re here to give you all the steps. 

With this guide, you’ll know EXACTLY what you need to do. 

So without further ado, let’s jump right in! 

How to Become an MLO in California – The 7 Steps

To become a mortgage loan officer in California, you need to complete these 7 steps: 

1. Have the right personal qualities
2. Create an NMLS account
3. Complete pre-licensure education
4. Pass the SAFE MLO exam
5. Secure an employer sponsorship
6. Submit the required documents 
7. Receive your MLO license

Let’s walk you through the details. 

Step 1: Have the Right Personal Qualities

Mortgage loan officers need to be detail-oriented. 

As an MLO, you’re constantly working with data from borrowers and lenders. 

It’s your responsibility to ensure all sensitive information and documents are accurate and secure. 

Besides being detail-oriented, it’s also valuable to be outgoing and friendly. After all, you’ll be working with a wide range of characters every day. 

Making a good impression is key to a blooming and successful MLO career. 

If you have these qualities, then working as an MLO is a great idea. 

If not, then you have to decide if you really want this job. If the answer is yes, then you should start working on these qualities (even if it doesn’t come naturally).

Step 2: Create an NMLS Account

It’s time to begin your application!

The Nationwide Mortgage Licensing System (NMLS) controls and monitors all mortgage license processes and applications. 

All aspiring MLOs in California must sign up through the NMLS website for their application request to get recognized. 

Applicants receive a personal NMLS number after creating an account, which they must keep for the duration of their time working as an MLO.

Step 3: Complete Pre-Licensure Education

You must complete pre-license education before you can obtain your MLO license. 

Now, each state has its own set of educational requirements. In California, that means going through 20 hours of coursework, including:

• 3 hours of federal law
• 3 hours of ethics
• 2 hours of non-traditional mortgage lending
• 12 hours of electives (with additional 2 hours on California content if applicable)

California currently has two NMLS licensing departments: 

• Department of Financial Protection and Innovation (DFPI)
• The Department of Real Estate (DRE)

If you already hold a real estate license, you should apply with the DRE since they provide MLO endorsements.

But if you’re a first-timer in the real estate industry, then choose the DFPI. 

Looking for approved MLO pre-licensing education? Here is a list of the best online providers:

• The CE Shop (DFPI or DRE)
• California Association of Realtors
• Allied Real Estate Schools

Step 4: Pass the SAFE MLO Exam

Even before you complete the required education, you can already take the SAFE MLO exam. 

However, keep in mind that it’s better to wait until you finish so that you can better know the answers to the questions. 

Now, in California, the SAFE MLO exam is administered by Prometric. 

Here’s how to enroll and schedule the exam:

• Create a test enrollment window through your NMLS account
• Pay the exam fee of $110. NOTE: payments at the test center are NOT allowed.
• Accept the Candidate Agreement
• Schedule an appointment through your NMLS account or directly with Prometric
• Take and pass the SAFE MLO exam (whether online or in-person)

What can you expect from the SAFE MLO exam?

There are 120 questions in total, but only 115 will be scored. Takers need a score of at least 75% to pass.  

You’ll have approximately 3 hours to complete your exam. 

If you fail, you’ll have to reschedule, repay, and retake the exam. 

You can learn more from the NMLS Examination Handbook.

Step 5. Secure an Employer Sponsorship

Next up, you have to find an employer or company sponsorship. 

This is the company that you will be working with. And because of that, you need to make sure that you go with the one that suits YOUR needs and preferences. 

Once you find an employer, have them request sponsorship with you from either the DFPI or DRE. If approved, you can move on to the last step…

Step 6: Submit the Required Documents

There are 4 documents that you need to submit: These are:

• Individual Form (MU4) – This is found and submitted in your NMLS account. This form is your MLO license application, so make sure to read and fill it up carefully. Your license status will remain “pending” until you complete all the steps. 

NOTE: Your sponsoring company may submit FORM MU4 for you. Make sure you ask them before doing it yourself. 

• Criminal Background Check – On Form MU4, you need to authorize a Criminal History Background Check. From there, you should schedule to be fingerprinted (more on this below)

• Credit Report – On Form MU4, you need to complete an Identity Verification Process (IDV). This will authorize a credit report viewing. 

• Any Supporting Documents – For each “YES” response in Form MU4, provide the necessary documents. You also need to show proof of name change (if applicable) and proof of citizenship or legal presence. 

To schedule fingerprinting, follow these steps:

1. Log into your NMLS account
2. Go to “Filing Section”
3. Select “Criminal Background Check”
4. Complete the required appropriate fields 
5. Pay the background check fee of $
6. Schedule an appointment to submit your fingerprints 

Here is a chart of all the fees you will spend for these documents:

Step 7: Receive Your MLO License

Once all the steps are completed and all the documents submitted, you can now receive your MLO license. 

Your “pending” license status will change to “approved-active”. 

And from there, you will receive your official credential. 

Congratulations!

Frequently Asked Questions About Becoming a Mortgage Loan Officer in California

Even after knowing all the steps, you might still have some questions. 

Well, let’s go over the most asked ones. 

How much can mortgage loan officers make in California?

The average MLO in California makes anywhere between $64,000 to $71,000 annually. 

However, high performers can expect to earn around $98,000 to $200,000 yearly. 

Your opportunities are endless, as long as you play your cards right. 

What skills do I need to become an MLO in California?

Being detail-oriented, outgoing, and friendly can benefit you a lot if you plan to be a great MLO. 

Other qualities that you should consider strengthening are your problem-solving skills, communication skills, and analytical skills. 

Take a course or two to help improve these skills — it’s one of the best ways you can invest in your success.

Do I need to go to college to become an MLO in California?

No, the State of California doesn’t require applicants to be college graduates to get an MLO license. However, you must have a high school diploma or equivalent in order to apply. 

Wrapping Up

And that is how to become a mortgage loan officer (MLO) in California.

So, are you ready to get started?

Use this guide to help you stay on track throughout the process. It will help you through the hardest steps. 

Good luck!