Common Questions About Becoming a Mortgage Loan Originator in 2023

If you are looking for an additional career opportunity adjacent to the real estate industry, then becoming a mortgage loan originator may be the perfect choice for you. This is a rapidly-growing field, and there is currently a shortage of qualified professionals. In this post, we will take a look at some of the benefits of becoming a mortgage loan originator and answer some common questions that arise when entering this industry.

Is this a good time to get into mortgage loan origination?

We're all aware of how quickly rates have risen in the last year or so as the Fed takes action to combat rapidly rising inflation. This has been a factor in slowing demand, and concerns about price drops and a cooling housing market.  As a result, many people are wondering if this is still a good time to get into the mortgage industry. The answer is yes! Despite the recent rate increases, there is still strong demand for mortgages. And, even though mortgage rates have risen, they are still historically low, and many analysts predict decreases in 2023. This means that there is still a lot of demand for loans, and originators able to meet this demand can be very successful. In addition, becoming a mortgage loan originator can be a great way to diversify your income. Rather than relying solely on commissions from selling and buying homes, you can also earn income from originating loans. This can help to stabilize your business and provide you with more consistent earnings even in times of uncertainty. Finally, mortgages are a rapidly-growing field, and there is currently a shortage of qualified professionals. As a real estate agent with an MLO license, you can build on existing connections to create a referral network that works for you.

Do I need to be a real estate agent to become an MLO?

No, you do not need to be a real estate agent to become an MLO. However, many people who are interested in becoming an MLO are already real estate agents as they can build on existing networks and are familiar with that side of the industry. If you are not a real estate agent, your requirements for obtaining a license are the same. As an MLO without a real estate background, focus on developing connections with potential buyers in your area and especially real estate agents who can bring you referrals as their clients seek financing for their purchases.

How do mortgage loan originators earn money?

Mortgage loan originators typically earn a commission for every loan they originate. The average commission is about 1-2% of the loan amount, but it can vary depending on the type of loan and the lender. MLOs will receive the percentage amount of the commission that they have negotiated with their brokerage. Some lenders also offer bonuses or other incentives to "top producers," or mortgage loan originators who generate a lot of business.

Can I work both as a real estate agent and a mortgage loan originator?

You can work as both a real estate agent and a mortgage loan originator, but you will need to get a mortgage loan originator license in addition to your real estate license. The mortgage loan originator license allows you to originate loans on behalf of a lender. However, you generally cannot be a real estate agent and a loan originator for the same client or on the same transaction. You can work with the same client as both a real estate agent and a mortgage loan originator in some cases, but you will need a disclosure and get the client’s permission first. Even if you intend to work primarily as a real estate agent, it can be a good idea to get your MLO license even if you are not planning on originating loans right away. The cost of the pre-licensing course and passing the state exam is relatively low, and you will have the ability to originate loans when you are ready. With an MLO education, you can also give more value to your clients by providing them with extensive insight into the financing side of their transactions. The mortgage industry is constantly changing, and having your MLO license will give you an edge over other real estate agents who do not have one.

How do I get started?

So, what does it take to become a mortgage loan originator? In the state of Georgia, there are two main requirements. First, you must complete 20 hours of pre-licensing education from an approved provider. Second, you must pass the state exam. Once you have met these requirements, you will be issued a license which must be renewed every year by completing 8 hours of approved continuing education courses. To practice with your MLO license, you must work under a licensed mortgage brokerage.