Is It Possible To Become A Loan Officer With Bad Credit?

This Article On Can I Get Approved For An NMLS Loan Originator License With Bad Credit

Can I Get Approved For An NMLS Loan Originator License With Bad Credit is one of the most common questions we get at Capital Lending Network, Inc. Many people who want to pursue a career as a loan officer need to prepare to get their NMLS Loan Officer license. Many of those who want to pursue getting licensed as a loan officer want to make sure they will not have any hiccups when applying for state NMLS licenses after they have gone through the intense training and passing the federal NMLS MLO examination. However, when they contact the NMLS and/or the state mortgage regulator, they do not get a straight answer. Many people with prior bad credit do not want to go through the pre-licensing course and through hours and weeks of studying for the national federal NMLS examination. In this article, we will go over the general credit background investigation phase of the licensing process conducted by state mortgage regulators. One thing to keep in mind is that every state has their own criteria in evaluating a licensing candidate’s credit profile. Another thing to note is also up to the state licensing examiner in using their discretion in granting a loan officer licensing applicant a license with bad credit. There are certain states that are stricter on a candidate’s credit profile than others.

Can I Get Approved For An NMLS Loan Originator License With Bad Credit: What Credit Score Is Required By Regulated To Get An NMLS License Approved

What Credit Score Is Required By Regulated To Get An NMLS License Approved

One of the most commonly asked questions by loan officer candidates is what the minimum credit score requirements. Each state has their own credit profile standards for candidates who are seeking NMLS licenses. However, most states are not too concerned with credit scores. They are more concerned with derogatory credit tradelines. A credit report is pulled by the NMLS when you apply for your MLO NMLS license. There are states where it is more strict with derogatory credit tradelines than other. However, it is ultimately up to the licensing examiner to decide whether the bad credit of a NMLS licensing applicant merits. a state NMLS license or the candidate has displayed financial irresponsibility due to their bad credit. California has one of the most lenient standards when it comes to getting a NMLS MLO license with bad credit. I have seen loan officers with large outstanding collections, judgments, charged off accounts, late payments, repossessions, foreclosure, and other derogatory credit tradelines and still get approved. Other states like Texas have denied NMLS MLO applicant with credit scores in the high 700’s due to having a collection and/or charged off accounts from many years back. Each state mortgage regulator will independently review the credit information of MLOs licensed in their jurisdiction. Therefore, if California had an individual mortgage examiner who had issues with candidates with bad credit, the individual particular applicant may have an issue with getting a NMLS MLO license in California. This holds true when other candidates did not have any issues getting a MLO NMLS license approved due to having been assigned an examiner with more compassion for candidates with bad credit. However, in general, California approves most NMLS MLO licensing applicants with bad credit including outstanding collections and/or charged-off accounts.

How State Licensing Examiners Review And Approve Credit Profile Of NMLS MLO Candidates

All new mortgage loan originators require their credit check by the NMLS. The credit report of the loan officer applicant is stored on the NMLS database for regulators to have access to your credit report on states you are applying for your state NMLS license. The NMLS will pull a Transunion credit report. It will be a soft pull so no need to worry about dropping your credit score due to a hard inquiry. There are no written guidelines and/or standards or credit score requirement developed by the NMLS and/or state regulator. They leave the examining regulator of the licensing applicant full discretion in determining the applicant’s financial responsibility standards to merit a NMLS MLO license.

Here is the guidelines on how state mortgage regulators evaluate and review a NMLS MLO licensing candidates financial responsibility when reviewing their credit report:

 The SAFE Act requires that mortgage loan originator applicants have, “demonstrated financial responsibility, character, and general fitness such as to command the confidence of the community and to warrant a determination that applicants will operate honestly, fairly, and effectively.” The SAFE Act leaves it to the discretion of each state regulator to develop their own processes and standards for reviewing credit information and determining the financial responsibility of their licensees.

In the following paragraph, we will go over concerns NMLS MLO licensing candidates have. We will go over on how to make sure that you will not any issues in getting your NMLS MLO license.

How To Get Approved For A NMLS MLO License

How To Get Approved For A NMLS MLO License

If you have outstanding collections and/or charged off accounts, the state licensing examiner may require for you to pay it off in order for you to be eligible for licensing. Another option you have is to enter into a written payment agreement with the creditor. Written payment agreements on unpaid collections and/or charged-off accounts will be viewed favorably by state regulators and you will get approved. If you have a lot of outstanding collections, charged off accounts, judgments, and other derogatory credit tradelines, you may want to consider filing bankruptcy. Bankruptcy is a federal law that give consumers a fresh start. It is better for you to have a bankruptcy than have outstanding collections, charged-off accounts, judgments that has not been addressed and is just sitting out there. You will not have any issues getting your NMLS state license in any states with a bankruptcy. A bankruptcy will clear out most debts unless they are debts that are government debts and/or debts due to fraud.


Peter has 7+ years of experience in residential lending. He is a licensed Realtor in the Chicagoland area.

14 Comments

We are trying to purchase a new build in NV. Our loan guy said we are turned down due to late payments over 10 months ago on our second. The first is perfect.
email works best.

California is the easiest state to get approved for a MLO NMLS license. I got approved for my MLO NMLS license from the DBO California with late payments, collections, tax lien, and a judgment. The only issue with California is it takes three to four months to get your MLO NMLS license. Texas and Georgia denied me. Actually, they told me they were going to deny me and recommended that I withdraw my application. I did so.

Texas denied me because I had several collections and charged off accounts due to my divorce. I did get approved with other states: Ohio, Indiana, Alabama, Virginia, New Jersey, Arizona, Once I filed bankruptcy and got my bankruptcy discharged, I applied again in Texas. Texas approved me after my Chapter 7 bankruptcy discharge. I like to thank Gustan Cho in advising me in filing bankruptcy. Bankruptcy is the solution to get your NMLS license approved in states they are strict with unpaid collections, charged off accounts, and judgments.

Texas denied me because I had several collections and charged off accounts due to my divorce. I did get approved with other states: Ohio, Indiana, Alabama, Virginia, New Jersey, Arizona, Once I filed bankruptcy and got my bankruptcy discharged, I applied again in Texas. Texas approved me after my Chapter 7 bankruptcy discharge. I like to thank Gustan Cho in advising me in filing bankruptcy. Bankruptcy is the solution to get your NMLS license approved in states they are strict with unpaid collections, charged off accounts, and judgments. I heard that as soon as you file Chapter 7 bankruptcy, you can get approved for your NMLS Texas license without it being discharged. That was the case with my co-worker. She got her NMLS license for Texas approved without her bankruptcy being discharged.

I want to thank Gustan Cho Associates for helping me five years ago giving me hope and answering the question about getting your NMLS with bad credit and Gus was spot on. Since then, I joined Gustan Cho Associates.
The employees are very helpful. They are team oriented. Best company I ever worked under. Give you the tools you need to succeed. If you are looking for great company STOP now. This Company is definitely WINNERS!

Capital Lending Network, Inc. is seeking an experienced mortgage loan officer with strong marketing, communication, and analysis skills to join our team and assist loan applicants in securing the ideal mortgage for their new home purchase. Job seekers should have a proven track record for creating successful lending solutions for clients and a desire to assist buyers in obtaining the property of their dreams. We believe in removing obstacles and creating a supportive and lucrative environment for you to thrive in. If this sounds like a job you’ll love, please send us your resume today! Compensation:
$80,000 – $250,000 yearly
Responsibilities:
Monitor the mortgage process to ensure all company and regulatory processes are followed
Manage a large pipeline of loans to ensure your production meets our requirements
Assure the timely and accurate completion of necessary documentation from borrowers, title companies, loan officers, and other related industry professionals
Communicate a thorough understanding of different loan programs and closing costs to help prospective buyers make a decision
Interact with customers, realtors, processors, and underwriters to ensure a smooth transaction
Qualifications:
Current NMLS State License or Federal NMLS Registration
Strong understanding of company loan policies and guidelines, as well as all federal and state regulations
Knowledge of FHA, VA, USDA, conventional, fixed/ adjustable loans, Bridge Loans, Non-Conforming Loans, FNMA and FHLMC, and Home Equity Lines of Credit
Candidates must have 1 year of mortgage origination or lending experience
Exceptional decision-making ability, superior written and verbal communication skills, and superb interpersonal and customer service skills required
About Company
At Capital Lending Network, Inc., our mission is the relenting pursuit of perfection. We pride ourselves on the lending excellence and the superior level of service that our status as a mortgage bank enables us to provide. Our ongoing success is driven by our strategy to deliver our clients a level of service unrivaled in the mortgage industry. We recognize that people are our competitive advantage. That’s why we put so much emphasis ensuring that Capital Lending Network, Inc. is a great place to work.

I want to get a refinance into my name only, my partner and I separated 3 years ago and he quitclaimed the property to me, I have been with my current mortgage lender since 2011 . I reached out to refinance and they pulled my credit report and said even with having a car repossession from three years ago it all looked good and said I qualify to refinance , when it went to underwriters they denied me and wanted it paid. I just want to know if you could help me . I have exceptional repayment on my credit report and have even paid two collections off from three years ago , that was said needed to be paid with my mortgage lender last month, then they said the car repossession had to be paid. I have a FHA loan currently .

First of all. Like to thank you for the great information you provide on this website. I want to get a refinance into my name only, my partner and I separated 3 years ago and he quitclaimed the property to me, I have been with my current mortgage lender since 2011 . I reached out to refinance and they pulled my credit report and said even with having a car repossession from three years ago it all looked good and said I qualify to refinance , when it went to underwriters they denied me and wanted it paid. I just want to know if you could help me . I have exceptional repayment on my credit report and have even paid two collections off from three years ago , that was said needed to be paid with my mortgage lender last month, then they said the car repossession had to be paid. I have a FHA loan currently .

With havin so much content do you ever run into any issues of plagorism or copyright violation? My site has a lot of completely unique content
I’ve either written myself or outsourced but it looks like a lot of it is popping it up all over the internet without my authorization. Do you
know any techniques to help reduce content from being
stolen? I’d really appreciate it.

Good afternoon,
I have been interested in getting my MLO certification for a while now. But my credit is not the best. I was researching if it was a possibility given my credit at this time. I live in Georgia and while researching I seen your article about your experience and email. I am in a similar predicament as you. Given I do not want to do all the schooling and still get told no and it be fore nothing. My lowest between the the three is 507 with the highest being 538. My total debt is less than $2000 and I have hired a credit repair company. But I was a single mom for a long time and have been working crazy hours in a local emergency room for the past 6 years now. And up until a year ago I was responsible for raising my daughter on my own. Now things have turned around and I am remarried to where I am able to do the online course to get certified and change careers. But I don’t want to go through all of it for nothing. If you could please help. I’d appreciate it more than you know.
Thank you
Jody Kaitlyn Price

Jody, credit scores don’t matter. As long as you enter into a written payment agreement with the creditors you will be fine. Georgia and Texas are two of the toughest states when it comes to credit. Go to http://www.gustancho.com and click resources. Read the first two articles on rebuilding credit and boosting credit scores. I recommend you contact David Reinholtz at http://www.loanofficerschool.com. He has the best loan officer training program

I purchased my home for $200,000 11 years ago. Roughly seven years ago I had a loan modification due to losing my job, which lowered the interest rate. About two years ago the loan was purchased from Bank of America, and is now held by Carrington. I currently owe just under $145,000 on my mortgage and would like to refinance to take advantage of theses historically low rates and lower my payment. My neighbor just entered a contract to sell their house for $212,000, given this I feel I have considerable equity in my home. My current rate is 4.50

Excellent web site. Plenty of helpful info here. Sending it to some friends ans also sharing in delicious. And obviously, thanks for your sweat! Good Day Mr. Gustan Cho ,

My name is Tom Lam ( Wang Bun Lam ), I live in suburban Philadelphia in PA. I am a PA license Realtor , and just passed my Mortgage Exam at the end of the pass July. I waited November to start the license procedure. I am currently working to get my criminal back ground check and is scheduled to get my finger print this weekend.
Well, i am looking to find a company which allow me to work remotely which i don’t need to sit in the office since i do spend a lot of time being a realtor and manage my clients’ properties. I want to start slowly, willing to ask questions and good capability of learning. ( As long as my question gets answer. … lol). I happened ran into your webpage and looks like i may be a good fit into your company. So i want to reach out to your company and ask if we can go another step deeper to understand each other. By the way , i am Chinese , grew up in Hong Kong, came to US in my teen. I can speak Cantonese, Mandarin, FuJianess, English. And i lived in Suburban Philadelphia Metro which has a high Asian population and new immigrants.

Please let me know if I can be part of your team or any comments.
Thank you in advance.
Sincerely,

Tom Lam

Good day! This is my first comment here so I just wanted to give a quick shout-out and say I genuinely enjoy reading your blog posts. Can you suggest any other blogs/websites/forums that go over the same subjects? I need financing of 140,000 for a manufactured home on a permanent foundation that is worth 227,000. all my income is untaxable and would need to be grossed up because it is social security and separate maintenance. I do have some collections for some credit cards and medical bills on my credit report that was supposed to be presented to workman’s comp and my credit cards went into collections while I was waiting on my income to be restarted
Thank you!

Leave a comment

Your email address will not be published.