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Law Updates for Mortgage Brokers/Mortgage Loan Officers


Pre-Licensure Education In order to receive a Mortgage Loan Originators license, a person must take the required steps to achieve certification.

The ore-education only needs to be done once, regardless of how many states you are eventually licensed in. This regulation was updated in 2011 to include that all education must be NMLS approved.

The Nationwide Mortgage Licensing System and Registry (NMLS) requires 20 hours of prelicensure education before taking the MLO test.


Certification After the required amount of pre-licensure hours are completed, you are eligible to take the MLO tests required by your state.

The licensure process doesn’t end there though. Now, you must complete a few more personal history checks and enroll in mandatory continuing education classes.

The certification tests must be in compliance with the SAFE Act PE test Requirements.


Continuing Education SAFE requires all MLOs to complete 8 hours of continuing education credits every year before renewal.

Licensed mortgage brokers and loan officers can choose to complete their continuing education online to make the process easier to complete.

Continuing education is relatively inexpensive, but fees may vary from state to state just like the fees for the licensing tests.


Types of Continuing Education Courses Individual state agencies may require licensed mortgage brokers and loan officers to take more than 8 hour, but according to the updated MLO SAFE requirements, 8 hours is the minimum.

Some of the usual courses include 3 hours of federal law, 2 hours of ethics, 2 hours of nontraditional mortgages and 1 hour of elective consumer credit and credit scores.

Other continuing education courses online can include anti-money laundering, short sales, and specific state mortgage laws as well.


SAFE MLO Test The SAFE MLO test is a nationally recognized test to license mortgage brokers and loan officers.

The National Component Test and the Uniform State Test costs $110 and is comprised of 125 questions. Test takers are allow 225 minutes to complete the test. The state tests are $69 and are comprised of 55-65 questions. The time limit for these tests is 120 minutes.

However, the one test may not be enough for some states. Along with the national test, a Uniform State Test is also required, and some states also require a Unique State Component Test.


Criminal Background Check Besides the pre-education, the testing , and the continuing education, several different personal history checks are required.

One is a criminal background check, which is available only to regulators.

SAFE requires all MLOs to submit fingerprints so that they can undergo a federal background check to ensure they have no relevant criminal background.


Credit Report The next check is a credit report check.

The credit report will be pulled through NMLS and like the background checks, they will only be available to regulators.

This process however, is not nationally uniform. Each state will implement its own type of review of the credit report.


Exceptions Though the national regulations were update in 2010 and implemented by all states in 2011, there are still some state exceptions.

If someone has completed their 20 hours of pre-education before the education hours were required to be NMLS approved, they may still be able to take their tests. Also, MLOs who have already passed their state test may not need to take the required Uniform State Test section on the national test.

Usually these have to do with pre-education before licensure. They also have to do with what type of tests are taken.


Why Do the Laws Change? The laws are updated every few years to ensure that they meet the current mortgage broker/loan officer requirements.

Other updates, like the credit check, just help keep the system secure to ensure that only qualified people are licensed.

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Some of the newest requirements have been with the national test itself. The Uniform State Test was designed for brokers and officers that wished to be licensed in multiple states without having to take multiple state tests.


Law updates for mortgage brokers and mortgage loan officers