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How to Become an Independent Loan Officer

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Loan officers are the gatekeepers in preparing loan files for underwriters. It's their job to make sure that the file looks the absolute best that it can in order for a consumer to get an approval. Due to the strains and stresses of their job, sometimes it's best to get out from under the umbrella of a large corporation who dictates your fees and every move. Here is your comprehensive guide on how to become an independent loan officer.

Obtain your loan officer education requirements. This will vary from state to state for very basic qualifications prior to taking a loan officer exam. Normal education requirements will include such things as: fair housing laws, lending laws and practices and guidelines for loan approval. Be prepared to study the laws pertaining to mortgage fraud in depth as that is governed by the FBI.

Contact your real estate board. It will provide you with all of the applications and licensing information in regard to being a independent loan officer. Many of these forms can be downloaded from the real estate board's website. Expect to wait between 30 - 60 days for approval of your educational background and requirements for your state.

Gather information on becoming an FHA-approved vendor. Since loan officers have to know the ins and outs of the mortgage industry to capitalize on the best options available, FHA approval is the first step in building your career and independence. The link to the FHA and Housing and Urban development website is found at the end of this article.

Get your VA loan approval as a lender while you are waiting for approval from Housing and Urban Development for FHA loans. VA loans require a strict and comprehensive sub-set of skills, so working on this from inception is the most practical measure. Becoming VA approved can take as little as 30 days or as long as 60 days. VA lending requirements include: VA loan limits, eligibility requirements and laws pertaining to appraisal and inspection requirements. You must demonstrate your ability to comprehend and act on VA loan guidelines. The link to the Veteran's website can be located at the end of this article.

Take all loan officer and outside vendor approval exams. Once you have done so, you will be issued a loan officer or mortgage broker number from your state as well as several federal identification numbers that you will use when submitting your loan applications and files from the National Association of Mortgage brokers.

Find a sponsor. Even though you will be acting as an independent loan officer many states still require that you have a sponsoring broker to provide you with insurance against mistakes. Common insurance that loan officers carry is something called E&O (Errors and Omissions) insurance, which comes at a per transaction rate. This is very similar to malpractice insurance in the medical field.

Order all marketing collateral for your independent loan officer and prepare to open up shop. Most marketing collateral will include fliers and business cards. Ensure that your sponsor's logo can be clearly identified on all of your business materials as well. While the prospect of being independent can be scary and intimidating, the step to get there are very easy and straight forward.


Contact your state mortgage and loan board to find out the licensing requirements in your area. Every state is different.

  • Contact your state mortgage and loan board to find out the licensing requirements in your area. Every state is different.