How to Become a Loan Officer in California: A Step-by-Step Guide

California is home to one of the largest and most competitive mortgage markets in the country. With high demand for real estate and mortgages being a loan officer in the Golden State can be a lucrative career. However you need to follow the proper steps to get licensed and start originating loans legally in California. This guide covers everything you need to know to launch your loan officer career.

Overview of Loan Officer Licensing in California

California regulates mortgage loan originators (MLOs) through the Department of Real Estate (DRE) and Department of Financial Protection and Innovation (DFPI). All loan officers must complete pre-licensing education pass exams submit application materials, and get sponsorship from a licensed lending institution. Key steps include

• Obtaining an individual NMLS ID number
• Finishing 20+ hours of pre-licensing education courses
• Passing the National SAFE Mortgage Licensing Exam
• Submitting background checks and fingerprints
• Applying for a state MLO license through the NMLS
• Securing sponsorship from a lender/brokerage

California participates in the Nationwide Multistate Licensing System (NMLS) for managing licensing All MLOs must register on the NMLS website to start the application process,

Detailed Steps to Become a Licensed Loan Officer in California

1. Request an Individual NMLS ID Number

• Visit the NMLS website and click “Create Account” to set up your profile.
• When prompted, request an individual NMLS ID number that will be tied to your name and profile.
• This ID number will be used across all your state licenses.

2. Complete Required Pre-Licensing Education Courses

• California requires 20 hours of NMLS-approved education covering national and state-specific content.
• Subjects include ethics, lending laws, consumer protection, and more.
• You must complete a 2-hour course on California law.
• Online self-study or in-person classes are available from approved providers.

3. Study and Schedule the National SAFE Exam

• Purchase study materials to prepare for the National SAFE Mortgage Licensing Exam.
• Schedule an exam date through the NMLS based on available testing center dates.
• The test has 125 questions and lasts 190 minutes.
• A minimum passing score of 75% is required.

4. Submit Fingerprints for a Criminal Background Check

• Initiate background check requests in your NMLS account under the Criminal Background Check section.
• Find an approved fingerprinting site to submit prints. Sites include police stations, UPS Stores, and other authorized providers.
• FBI and state background check fees total around $40.

5. Complete Your California License Application on NMLS

• Once you pass the SAFE Exam, submit your online application through the NMLS.
• California charges a $300 state licensing fee, plus NMLS processing fees.
• Make sure to authorize a credit report check.
• Your application remains in pending status during review.

6. Get Sponsorship from a Licensed Lending Company

• Search job listings to get hired by a bank, credit union, mortgage lender, or broker.
• Initiate sponsorship transfer through NMLS from your employer once hired.
• You cannot originate loans until a sponsoring company verifies your employment and license.

7. Consider Getting Licensed in Other States

• Research requirements to get licensed in other states for more job flexibility.
• You only need to pass the SAFE Exam once for all state licenses.
• Submit new applications and fees to each state agency.

Education and Exam Prep Tips

Here are some key strategies for getting through pre-licensing education and passing the SAFE Exam:

• Take detailed notes during all required course hours to retain knowledge.
• Purchase SAFE Exam prep books and materials from reputable providers.
• Thoroughly review all study guides, take practice exams, and focus on weak areas.
• Understand CA laws covered, including consumer disclosure forms used.
• Get a good night’s sleep before the exam and arrive early.
• Read each SAFE Exam question carefully before selecting an answer.
• Don’t second guess responses; go with your first choice.
• Flag tricky questions to come back to if you have spare time.

What is the Cost for Licensure in California?

You can expect to pay the following fees during the California loan officer licensing process:

• NMLS Application Processing Fee: $30
• Credit Report Fee: $15
• California License Application Fee: $300
• SAFE Exam Fee: $110
• Fingerprinting: $20-$30

Additional costs also include pre-licensing education courses, which range from $200 to $400 total. The grand total for everything often falls between $700-$800. Some employers may cover certain fees or reimburse new loan officers after a period of employment.

Finding a Job as a Licensed Loan Officer

Once licensed, focus your job search on these types of lending institutions:

• Mortgage lenders like banks, credit unions, and mortgage banks
• Mortgage brokers that work with wholesale lenders
• Online lenders and loan marketplaces

Search job sites for opportunities and highlight any past sales, customer service, or banking experience. Location flexibility is also key for new loan officers trying to gain experience. Expect a 3-6 month onboarding and training process once hired before originating your own loans.

Maintaining Your California Loan Officer License

Once approved, you must complete several steps to remain in good standing:

• Renew your license annually before the December 31 deadline.
• Pay renewal fees to NMLS and California.
• Complete at least 8 hours of annual continuing education.
• Maintain sponsorship from your employer.
• Keep your NMLS record updated.

Follow state agency instructions for license renewal through your NMLS account. Also review email notifications from NMLS regarding important updates or actions needed on your license.

Is Being a Loan Officer in California Worth It?

California is a highly lucrative state for mortgage loan officers. According to the U.S. Bureau of Labor Statistics, loan officers in California earn an average salary of $108,960. The state also has one of the highest volumes of mortgage originations in the country. Major metro areas like Los Angeles and San Francisco provide access to tens of thousands of potentialborrowers.

However, the path to getting your loan officer license in California does require an upfront investment. Make sure to consider the costs of education, exams, licensing, and finding employment when deciding if being a mortgage loan officer is the right career move for you. The high income potential makes it worth the effort for many sales-driven professionals.

Following each step carefully to earn your loan officer license sets you up for success. Avoid any shortcuts or you may end up having to delay your application. Stay persistent through the licensing process, connect with a reputable lending institution for sponsorship, and you can be originating loans in California sooner than you think.