How to become a loan officer

1. 1Earn a bachelor's degree in finance or business

   Time: 4 yearsCost: $10,515/yr median public in-state tuition (finance)Sources 1, 5

   Finance, business administration, economics and accounting are the usual majors. Commercial loan officers in particular need accounting skills, because they read business balance sheets, income statements and cash-flow reports to judge whether a company can repay. Courses in corporate finance, real estate, credit analysis and business law are directly useful. Internships at banks or credit unions are a common way into lending jobs.

2. 2Get related experience

   Time: Up to a few yearsCost: Paid workSources 1, 2

   Many loan officers start as bank tellers, personal bankers, loan processors or underwriting assistants, learning how files move from application to closing. BLS notes that people with banking, customer service or sales experience can sometimes become loan officers without a degree, and that mortgage companies often prefer candidates with real estate or residential mortgage experience.

3. 3Complete 20 hours of NMLS-approved pre-licensing education

   Time: A few days to a few weeksCost: Course price varies; NMLS charges providers $1.50/hour to bank creditsSources 3, 8

   For a state mortgage loan originator license, federal rules require at least 20 hours of NMLS-approved education, including 3 hours of federal law, 3 hours of ethics covering fraud, consumer protection and fair lending, and 2 hours on nontraditional mortgage products. The rest covers general mortgage topics. Individual states may add their own requirements, so check your state's rules in NMLS before you enroll.

4. 4Pass the SAFE MLO Test

   Time: 1 day (plus study time)Cost: $110Sources 3, 4

   The SAFE Mortgage Loan Originator Test with Uniform State Content has 120 questions, 115 of them scored, and allows 190 minutes of testing time. You need at least 75% to pass. If you fail, federal rules let you retake it after 30 days, up to three tries; after three failures you must wait six months. The test covers federal mortgage law, general mortgage knowledge, loan origination activities, ethics and uniform state content.

5. 5Apply for your license or registration in NMLS

   Time: Several weeksCost: State and NMLS fees varySources 3, 6

   State-licensed loan officers submit fingerprints for an FBI background check, authorize a credit report and show financial responsibility. You cannot have had a loan originator license revoked, or a felony conviction in the past seven years or any time for fraud, dishonesty or money laundering. Bank and credit union employees instead register in NMLS with fingerprints and their employment history, without the test or education requirement.

6. 6Train on the job and renew every year

   Time: First few months, then ongoingCost: Paid workSources 1, 3

   Lenders typically pair new loan officers with formal company training and coaching during the first months: products, pricing, underwriting guidelines and the loan software. State-licensed mortgage loan officers must renew annually and complete at least 8 hours of NMLS-approved continuing education each year: 3 hours of federal law, 2 of ethics, 2 on nontraditional mortgage products and 1 elective.

Programs, tuition and graduates’ earnings

U.S. Department of Education, College Scorecard (most recent cohorts, released 2026-10-15). Scorecard groups programs by 4-digit field, so a row can include related programs. Tuition is the median published undergraduate tuition and fees of the colleges offering the program (shown only for undergraduate credentials); debt is the median of programs’ median federal loan debt at completion; earnings are the national median for the field and credential four years after completion.

Requirements differ by state. Check your state’s rules in the CareerOneStop License Finder (U.S. Department of Labor) before you enroll.

Reading financial documents

Approving the right loans depends on spotting gaps or problems in tax returns, bank statements and, for commercial loans, business financial statements.

Sales and referral building

Mortgage loan officers in particular find most clients through real estate agents, builders and past borrowers, and their pay often depends on loan volume.

Attention to detail

A single wrong income figure or missing disclosure can delay a closing, cost the lender money or break lending rules.

Explaining terms clearly

Borrowers have to understand rates, points, fees and payments before they sign, and good explanations prevent complaints and cancelled deals.

Regulatory knowledge

Federal and state lending laws govern disclosures, fair lending and how loan officers can be paid, and violations can cost a license.

O*NET 31.0 rates these skills as most important for the occupation: active listening, speaking, reading comprehension, critical thinking, writing.

Training cost

$140–$42.2K

Before financial aid

Time

About 4-5 years (bachelor's degree plus licensing and on-the-job training)

Typical path

Median pay

$76,690

All US jobs: $50,980

Payback once qualified

0.0–1.6 yrs

Pay above the all-jobs median vs. cost

Low: $110 SAFE MLO Test fee plus the NMLS credit banking fee of $1.50 per hour for the 20 required pre-licensing hours ($30), which NMLS bills to the course provider and may be passed on in the course price, = $140, for people who enter without a degree. High: 4 years x College Scorecard median public in-state tuition for finance bachelor's programs, $10,515 = $42,060, plus the same $140 = $42,200. Not included: pre-licensing course tuition, which varies by provider, state license and NMLS processing fees, background and credit check fees, and living costs.

Rough guide only: ignores taxes, aid, interest and earnings given up during training. How we calculate it.

• Financial analyst$102,740 median

  Commercial loan officers with strong credit analysis skills can move into analyst roles at banks or investment firms, sometimes after a master's degree.

• Financial advisor$105,070 median

  Loan officers who want to advise on savings and investments can switch by passing FINRA exams such as the SIE and Series 7, with firm sponsorship.

• Insurance agent$62,280 median

  Lending experience with homebuyers and businesses transfers to selling insurance, which requires a state insurance license.

• Accountant$83,680 median

  Officers drawn to the financial-statement side of commercial lending can move toward accounting, which usually means additional accounting coursework and, for CPA licensure, passing the CPA Exam and meeting state board rules.