Learn About Being a Mortgage Broker

By Indeed Editorial Team

December 10, 2019

What does a mortgage broker do?

Mortgage brokers act as an intermediary between a lending financial institution and a prospective homeowner. They present mortgage loan options to a consumer from multiple lenders for comparison and evaluate financial and employment information from buyers. Once a lender offers a mortgage to a buyer, they complete the loan paperwork. Brokers can work in residential or commercial real estate. 

The day-to-day responsibilities of a mortgage broker usually include:

  • Establishing professional relationships with mortgage lenders to recommend them to clients

  • Gathering documents, credit history and employment verification for prospective homebuyers

  • Applying for mortgage loans with established lenders on behalf of the borrower

  • Comparing lender fees such as interest rates and closing costs to present options to the borrower

  • Advising clients on their options and clearly explaining the legal and repayment details of any available loan

  • Ensuring loans are compliant with all relevant regulations and laws

  • Completing all closing paperwork with the lender, title company, insurance broker and any other relevant agency

Average salary

Salaries for mortgage brokers vary based on the level of experience and whether they work for a firm or are self-employed. It may also vary depending on the size and geographical location of the organization in which they find employment. Additionally, some brokers earn a commission, which can also affect earnings. 

  • Common salary in the U.S.: $98,719 per year

  • Some salaries range from $14,000 to $265,000 per year.

Mortgage broker requirements

Success as a mortgage broker usually required a combination of education, licensure and specialized job skills.

Education

Mortgage brokers need a high school diploma or equivalent to fulfill the educational requirements. A mortgage broker can earn an Associate or Bachelor’s Degree in Business Administration, Finance or Accounting to expand their job opportunities and possibly increase their earning potential.

To maintain an active broker license, which is a requirement to practice in the U.S., brokers must complete continuing educations courses. These courses help a mortgage broker remain current with industry trends and regulations. The number of hours a broker needs to complete depends on the state that issues the license.

Training

Individuals must complete a 20-hour training course before taking the licensure exam. The training course focuses on topics such as federal and state mortgage laws, broker ethics and mortgage origination.

Once a mortgage broker gains employment, they typically receive on-the-job training. Their employer teaches them about company-specific practices that allow them to excel in their role. They also learn about specific scheduling software or computer programs the company may use.

Certifications

In the United States, the 2008 SAFE Act requires all mortgage brokers to earn a license by passing the SAFE Mortgage Loan Originator Test. The test encompasses a national and a state-specific portion. The National Mortgage Licensure System (NMLS) administers the test and keeps a record of all current licenses. Mortgage brokers need to renew the license annually.

Skills

Mortgage brokers spend a lot of their time establishing and maintaining relationships with lenders and borrowers and helping people navigate the complicated legal and financial terminology in mortgage documents. It is important to possess some of the following skills and qualities, including:

Customer service

To generate business and develop good relationships with borrowers and financial institutions, it is vital to have excellent customer service skills, like being a good listener, responding quickly to phone calls and emails and being able to explain the fine points and details of the application process and closing documents. Brokers employ customer service skills with borrowers to make them feel more comfortable during each step of the process.

Critical thinking

Mortgage brokers often gather information and statistics related to several different lending options and attempt to make the best choice for the borrower. They should have excellent critical-thinking skills to carefully review each document and choose the most viable option for their client. 

Communication

The mortgage process requires requests for employment verifications, pay stubs, credit histories and many other personal details. Being able to communicate those requests and explain any details in writing is important for a broker. As they work with a variety of professionals in the industry and buyers, brokers need good communication skills to correspond with all parties. Excellent communication also helps them easily explain industry and regulatory phrases to borrowers. 

Negotiation

The primary role of a broker is to create a lender-borrower relationship that could last for many years. Brokers act as a liaison between the two parties, and the ability to ensure they agree to common terms employs the use of good negotiation skills. 

Mortgage broker work environment

Mortgage brokers work in a fast-paced environment where communication is constant. Some brokers work in an office space with fellow brokers, assistant and mortgage professionals, while others work by themselves in a remote location. Each broker may have a unique working environment, but here are some conditions they usually share:

  • Meeting with clients in an office space

  • Communicating with lenders via phone or email

  • Generating new leads by networking with real estate agents, lenders, prospective home buyers and insurance brokers

  • Organizing multiple mortgages and clients at once, with heavy reliance on computers and telephones to communicate

  • Answering questions clearly and following up with the various phases of document requirements

  • Reviewing  details of legal documents to be able to convey their meaning clearly 

  • Repeating similar tasks

  • Working occasional irregular hours, such as nights and weekends, to meet the needs of borrowers

How to become a mortgage broker

You can follow these basic steps to become a mortgage broker:

1. Earn your desired education

The minimum educational requirement to become a mortgage broker is a high school diploma or its equivalent. Some companies prefer a candidate with an Associate or Bachelor’s Degree in Business Administration, Accounting or Finance. You can choose to earn a college degree to gain more knowledge of financial and analytical topics. It can be helpful to review local mortgage broker job descriptions to determine the best educational path. 

2. Obtain a broker license

Find an accredited institution that provides the 20-hour course required to prepare you for the licensing exam. Visit the NMLS website to find a course that satisfies the requirement in your area. The NMLS exam consists of 125 questions and lasts about four hours. You must take the exam at an approved testing center. 

3. Meet continuing education requirements

Throughout your career, you will need to take continuing education classes as recommended by the NMLS to keep your license current. When you renew your license annually, you will submit proof of your continuing education. 

4. Find mortgage broker jobs

Some mortgage brokers work with established companies that assist in building client relationships quickly. Other brokers work independently or on a contract basis. If you want to work with other brokers in an office setting that offers administrative support, search for jobs in broker companies. You can also search for contract positions to gain traction in the field and eventually become a self-employed broker. 

5. Gain experience

There are many opportunities for advancement as a broker. Many commercial or large real estate brokers require at least three years of experience. Consider finding a mentor that can help you create a defined career path as a broker and make professional industry connections. 

Mortgage broker job description example

We are seeking a vibrant, motivated, organized and experienced mortgage broker to join our brokerage firm. The ideal candidate will have a high school diploma, maintain a current license and demonstrate proficiency in all aspects of mortgage origination and closing. They will have at least three years of experience in the field and show good sales and networking techniques.

Primary responsibilities include:

  • Acting as the intermediary between potential lenders and borrowers

  • Analyzing and comparing multiple loans for recommendation to the client

  • Collecting and assembling required verifications to prepare for closing

  • Ensuring strict compliance with all state and federal regulations

  • Acting as the primary contact for borrower’s questions and clarifications

  • Submitting relevant documents on time

Related careers

If you’re interested in a role in real estate, consider one of the following careers related to a mortgage broker:

  • Underwriter

  • Real estate agent

  • Loan officer

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