Law Updates for Mortgage Brokers/Mortgage Loan Officers

1
Law Updates for Mortgage Brokers/Mortgage Loan
Officers
2
Pre-Licensure Education
In order to receive a Mortgage Loan Originators
license, a person must take the required steps to
achieve certification.
The Nationwide Mortgage Licensing System and
Registry (NMLS) requires 20 hours of
pre-licensure education before taking the MLO
test.
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.
3
Certification
After the required amount of pre-licensure hours
are completed, you are eligible to take the MLO
tests required by your state.
The certification tests must be in compliance
with the SAFE Act PE test Requirements.
The licensure process doesnt end there though.
Now, you must complete a few more personal
history checks and enroll in mandatory continuing
education classes.
4
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.
5
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.
6
SAFE MLO Test
The SAFE MLO test is a nationally recognized test
to license mortgage brokers and loan officers.
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.
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.
7
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.
8
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.
9
Exceptions
Though the national regulations were update in
2010 and implemented by all states in 2011, there
are still some state exceptions.
Usually these have to do with pre-education
before licensure. They also have to do with what
type of tests are taken.
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.
10
Why Do the Laws Change?
The laws are updated every few years to ensure
that they meet the current mortgage broker/loan
officer requirements.
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.
Other updates, like the credit check, just help
keep the system secure to ensure that only
qualified people are licensed.
http//www.educationlocation.com