• An FHA mortgage broker must meet federal and state requirements to broker loans.new home 3 image by Kathy Burns from Fotolia.com
  
  FHA is an acronym for the Federal Housing Administration, an agency within the U.S. Department of Housing and Urban Development. This government agency has issued a series of guidelines for mortgage brokers (and lenders) who want to broker loans through its programs. A broker must study broker requirements carefully to set up the right type of business. Becoming a broker through FHA is serious business because these legitimate guidelines make it difficult for a shady broker to set up a business and broker government-sponsored loans.
  
  

Mortgage Broker

• In 2010 and beyond, a mortgage broker must begin the licensing process by registering with the Nationwide Mortgage Licensing System (NMLS). The NMLS website informs applicants they must complete a criminal background check, fulfill education requirements before seeking licensure, take the nationwide and state components of the SAFE MLO (mortgage loan originator) Test, and authorize a credit report. The next step is to complete requirements for state licensure. NMLS also summarizes common requirements for state licensure.
  
  

Business Setup

• To be an FHA mortgage broker, a state-licensed broker must also set up a business according to government guidelines. A broker must form a corporation, partnership, Limited Liability Company or chartered financial institution unless exempted by states where offices are located. A broker must acquire a staff of at least two full-time workers that operate in a separate office. The public must be able to find this office using signs and a building directory listing. While a broker works in her office, her full-time employees must work only for her.
  
  

Financial Requirements

• Perhaps the most challenging aspect of becoming an FHA broker is satisfying financial requirements. A broker must demonstrate a minimum adjusted net worth of $63,000 (and $25,000 per branch office) for a total maximum net worth standard of $250,000. Of the broker's net worth, 20 percent must be liquid assets. On the application, a potential loan correspondent must supply audited financial statements, including at least one page of adjusted net worth. Most importantly, a financial lender must sponsor a broker's application, indicating it will provide the loan funding for all FHA home mortgages.