NMLS Certification: Choosing States and Completing the State Certificate Applications

Navigating the process of obtaining NMLS’s certification for state licenses can be a daunting task for lending startups. Nonetheless, knowing this process inside and out is the only way for new credit startups to thrive. 

The easiest way to think about the large process of getting an NMLS state license certification is as five mini-process: 

1. Choosing state certification(s) to pursue
2. Applying for NMLS State certification
3. Completing the Pre-Licensing education
4. Taking the NMLS State Licensing Exam
5. Completing the background check

These five mini-processes can be grouped into application, education, and background check categories. In this post, we’ll look at the steps involved with the first category – NMLS applications.   

Selecting a State for NMLS State Certification

Choosing which state to obtain NMLS state certification in for a credit startup will depend on a variety of factors, including the location of your business, your target market, and your expansion plans.

Here are some factors to consider when choosing which state(s) to obtain NMLS state certification in:

1. Location
2. Target Market
3. Competition
4. Licensing Requirements
5. Expansion Plans

Each of these items is looked at in more detail below. 

Location

If your business is located in a particular state, it may make sense to obtain NMLS state certification in that state first. This will allow you to establish a strong presence in your local market and build relationships with local customers.

Target Market

Consider the demographics of your target market. If you are targeting a specific geographic region or demographic group, it may make sense to obtain NMLS state certification in the states where your target market is located.

Competition

Consider the level of competition in each state. If there are already many established lenders in a particular state, it may be more difficult to gain a foothold in that market.

Licensing Requirements

Consider the specific licensing requirements for each state. Some states have more stringent licensing requirements than others, which may impact your ability to obtain NMLS state certification in those states.

Expansion Plans

Consider your long-term expansion plans. If you plan to expand your business to other states in the future, it may make sense to obtain NMLS state certification in those states as well.

Ultimately, the decision of which state(s) to obtain NMLS state certification will depend on a variety of factors unique to your business. It’s important to carefully research each state’s licensing requirements and weigh the pros and cons before making a decision.

Applying for NMLS State Certification

Once a lending startup has determined which state(s) they want to obtain NMLS state certification in, they can apply for certification through the NMLS website. Here are the general steps to apply for NMLS state certification:

1. Create an Account
2. Complete the Application
3. Pay the Application Fee

Read on to learn about each step. 

Create an Account

The first step is to create an account on the NMLS website. This will allow you to access the online application and submit your information.

Complete the Application

Once you have created an account, you can begin the application process. The application will include personal information, employment history, education, and criminal history. You will also need to provide documentation to verify your identity and any other required information.

Pay the Application Fee

There is an application fee for obtaining NMLS state certification, which varies depending on the state(s) you are applying for certification in.

It’s important to note that the exact steps to apply for NMLS state certification may vary slightly depending on the state(s) you are applying for certification in. You should carefully review the specific requirements for each state before beginning the application process.

Final Thoughts

Obtaining NMLS state license certification is a crucial step in establishing a lending startup’s credibility and access to resources. While the process of obtaining certification may seem complex and overwhelming, breaking it down into mini-processes and understanding the steps involved can help simplify the process. By carefully considering factors such as location, target market, competition, licensing requirements, and expansion plans, lending startups can make informed decisions about which state(s) to pursue certification in. Once the state(s) are chosen, applying for NMLS state certification involves creating an account, completing the application, and paying the application fee. With careful research and preparation, the certification process can be a smooth and successful one, helping lending startups establish a strong foothold in their target markets and expand their businesses in the long term.

NMLS State Certification Applications FAQ

Here are four frequently asked questions (FAQ) related to NMLS state certification applications and their answers:

What is the NMLS state certification application process, and how long does it take?

The NMLS state certification application process involves completing the required pre-licensing education, passing the NMLS National Exam, completing any additional state-specific requirements, submitting an application, and completing a background check. The length of the application process can vary depending on the state(s) you are seeking certification in and the time it takes to complete all the required steps. The approval process can take several weeks to several months.

What is the cost of applying for NMLS state certification?

The cost of applying for NMLS state certification varies depending on the state(s) you are seeking certification in. Each state sets its own licensing fees, and some states may also charge additional fees for fingerprinting and background checks. It’s important to review the specific fee schedule for each state before beginning the application process.

What are the eligibility requirements for NMLS state certification?

The eligibility requirements for NMLS state certification vary depending on the state(s) you are seeking certification in. However, some common eligibility requirements include completing the required pre-licensing education, passing the NMLS National Exam, meeting any state-specific requirements, and passing a background check. Some states may also have additional requirements, such as prior work experience in the industry.

How long is NMLS state certification valid, and how do I renew my license?

The length of NMLS state certification varies depending on the state(s) you are certified in. Generally, licenses must be renewed every year or two and require completion of continuing education courses. The specific renewal requirements and process vary depending on the state(s) you are certified in. It’s important to keep track of your license expiration dates and follow the specific renewal procedures for each state.

Frank Gogol

A seasoned SEO expert, Frank has a long history of working with and for startups. Starting in mid-2018, Frank served as the SEO Strategist for Stilt, a fintech startup that provided fair loans for immigrants in the US and other underserved markets. While with the company, he scaled site traffic from zero to more than 1.5 million unique visits per month, driving the bulk of the company’s lead generation until it was acquired by J.G. Wentworth in December 2022. As employee #5 at Stilt, Frank was witness to, and part of, the successful building and sale of a fintech company, uniquely positioning him to create content for founders about all things startups.

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