Christopher Cruise, senior national trainer, and Christopher D. Nickerson, chief executive officer, TrainingPro

As published in Scotsman Guide's Residential Edition, March 2005.

The licensing environment for residential-mortgage-loan originators is shifting back from its specialized focus to the basics of the mortgage industry as a whole. To conduct business, many originators now are required to complete pre-licensing courses and comprehensive mortgage-lending exams, which require broader knowledge and more preparation than in the past.

The courses are designed to ensure originators are educated in all aspects of the mortgage industry, not just origination. Topics can include federal laws, qualifying borrowers, government loans, servicing, ethics, credit scoring, wholesale lending, the secondary market, reverse mortgages and mortgage insurance — some of which are unfamiliar to mortgage originators.

About half of the states requiring continuing education also require a pre-licensing course, and more than 10 administer mandatory, state-proctored exams. Each year, more states add pre-licensing requirements for originators.

Regulating originators’ knowledge and education is a notable effort considering the attention and focus on predatory lending and ethical issues in the mortgage industry. However, originators must realize that state regulators do not administer exams for specialized fields or niches, such as residential-mortgage-loan origination. States require a broad base of industry knowledge.

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