Whether you’re aspiring to be a mortgage loan originator or studying to become one, chances are you’re curious about your NMLS number and have wondered, “Who needs an NMLS number and why is it so important.?”
Let’s first understand – WHAT is the NMLS? And then, we can dig deeper into the importance of the NMLS number.
What is the NMLS or Nationwide Multi-state Licensing System
The NMLS is an online platform for various regulatory agencies to issue license applications (like your MLO license) and ongoing compliance requirements.
According to the NMLS website:
“The Nationwide Multistate Licensing System (“Nationwide Mortgage Licensing System,” NMLS,” or the “System”) is the system of record for non-depository, financial services licensing or registration in participating state agencies, including the District of Columbia and U.S. Territories of Puerto Rico, the U.S. Virgin Islands, and Guam.
In these jurisdictions, NMLS is the official system for companies and individuals seeking to apply for, amend, renew, and surrender license authorities managed through NMLS by 64 state or territorial governmental agencies.
NMLS itself does not grant or deny license authority.”
In fact, NMLS is the SOLE system of licensure for mortgage companies (for 58 states) AND mortgage loan originators (59 states and territorial agencies).
Besides MLOs and mortgage companies, money transmitters and money service agencies also use the NMLS for licensing and applications.
You can use the NMLS website right here to register for exams, make payments, report authorized agents, renew licenses, and more.
Created by the Conference of State Bank Supervisors (CSBS) and the American Association of Residential Mortgage Regulators (AARMR), the NMLS was formed in 2008.
Its MAIN goal is to bring state-based financial services together on a nationwide platform to improve coordination, facilitate and increase information sharing, maximize the overall efficiency, and set in place much better consumer protection.
Who Needs an NMLS Number: What Do Mortgage Loan Originators Need to KnowThe NMLS Number is a unique identifier assigned to every mortgage loan originator and financial institution. Depending on who is applying, the NMLS ID is assigned to a company, branch, or natural person. Also, once assigned, the NMLS ID or number is unchangeable. Now you might be wondering… … what is the purpose of this NMLS number? So, here’s what happened… After the financial catastrophe of 2008, the Secure and Fair Enforcement of Mortgage Lending Act was passed. Under the SAFE Act, states were mandated to find a way to keep track of mortgage officers and loan originators so they couldn’t simply switch states and disappear. Think of your NMLS ID as a license plate. But with more powers! Because, here’s the thing… When YOU, as an MLO get your NMLS number, not only can regulators track mortgage loan companies and professionals across state lines but also consumers can look up credentials and compare history, backgrounds, etc., using the NMLS Consumer Access portal. Yes, your NMLS number is powerful, important, and also brings credibility and accountability back to the mortgage industry.
How do You Get an NMLS Number
When you create an account in NMLS, your unique identifier is assigned and reserved.
BUT the validity of this NMLS number kicks in only when you get your state or federal licenses, like your MLO license.
Ready to get your license?
Pop in your details for the FREE NMLS Success Kit so you’ll know your next steps and can start smart!