What Is a Mortgage Originator Test?

A mortgage originator test is an examination that anyone intending to originate mortgages must pass. In many countries, government agencies issue mortgages licenses to people who pass the mortgage originator test, and only people in possession of such a license can work as lenders. The test typically includes information related to lending laws and products.

Prior to taking a mortgage originator test, a candidate normally has to go through a mortgage training course. Prospective lenders are taught about lending products and ethics during the training course. Banks and financial companies normally pay for employees to attend these training sessions, but self-employed individuals have to cover their own costs. At the conclusion of the training class, candidates normally take a practice test that covers material similar to the information that is included in the actual mortgage originator test.

A mortgage test is normally broken down into several different sections, and candidates have to answer a certain number of questions correctly in each section in order to pass the exam. The legal section of the test contains questions that test the candidates’ knowledge of rules relating to the assessment of fees, the way rates are calculated, and prohibitions against discriminating against loan applicants on the basis of race, religion, or gender. In the ethics section of the exam, candidates are normally presented with fictional scenarios and must specify how mortgage originators should handle each situation. To score well in the ethics section, candidates must demonstrate an understanding of how to act in the best interests of prospective clients rather than focusing on making sales.

After taking the mortgage originator test, exam candidates often have to wait a few weeks before finding out if they passed the test. In some circumstances, people who fail the exam have the opportunity to immediately retake it. People who need to retake the test generally must pay a fee to do so, and in some countries people who fail must also retake the mortgage examination class.

People who pass the exam receive a license and are able to work as mortgage originators or brokers. Regulatory authorities usually require active brokers to take continuing education courses on an annual basis in order to keep their license active. Mortgage originators who allow their license to lapse can usually have it reinstated if they take the necessary continuing education classes and pay a reinstatement fee. Lenders who originate home equity loans and business loans do not typically have to obtain a mortgage license or take the origination test.