Bad news: there are 50 states (plus territories) to track NMLS requirements, transition plans, and deadlines. Good news: there seems to be some common themes and practices, making it feel a little easier to grasp. This is where I find Maryland mortgage loan originator requirements.

Like all states, Maryland loan originators must complete 20 hours of NMLS prelicense education, including 3 hours of federal law, 3 hours of ethics, 2 hours of nontraditional loans, however, they must also complete 5 hours of Maryland law.

And like all states, they have to pass the SAFE Mortgage loan Originator Test. It is a 2-part test, a national component and a state component, which can be taken separately. Then there is a bonding requirement, passing a background check, and demonstrating financial responsibility. Read the rest of this entry »

A few weeks ago ProSchools got the 20-Hour Iowa SAFE Comprehensive Course approved.  Now the big question is this:

Who in Iowa needs it?

Since Iowa has already had loan originator education in place for a couple years, most current Iowa mortgage licensees will have their past education “certified.”  That means they won’t need to do the 20 hours of NMLS education. However new Iowa loan originators, those just entering the business after July 2009, will need to take the 20 hour SAFE Course prior to obtaining their license. Read the rest of this entry »

New Hampshire passed legislation that went into effect April 1, 2009, requiring all individuals whose activities fall under the legal definition of “loan originator” to be licensed. This fulfills mandates of the SAFE Act. So the question is, how does this transition out over the next months?

All loan originators have to be licensed through the NMLS and must be sponsored by a company that has filed and been approved on the NMLS.  Since April 1st 2009, no individual can act as a loan originator without an approved New Hampshire license. Read the rest of this entry »

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The NMLS is anticipating 24 states will be able to take the state and national components of the NMLS exam by the end of the year. So far almost every state (47 states), plus the District of Columbia, have passed legislation that requires prelicense education, passing the NMLS exam, submitting fingerprints for a criminal background check, and demonstrating financial responsibility.

It looks like the majority of states are requiring that the license requirements be met by July 31, 2010, but some have a December 31, 2009 deadline. Even states that have the later deadline are encouraging loan originators to meet the license requirements by the end of 2009 to prevent a bottleneck. The only hitch is the background and credit check. The NMLS is working hard to add that feature to their system but it probably won’t be until 2010 before those requirements are done through the NMLS.

ProSchools encourages mortgage loan originators to check the NMLS website for frequent updates.

I keep getting asked my mortgage loan originators (MLO) who recently took a state exam (or will shortly) if they are going to have to take another exam when the SAFE Act and the NMLS kick in.  As I read it, the answer is clearly “YES”.  Sorry.  What I’ve read is real clear.  Essentially, if you have taken a state exam that meets certain psychometric standards, you will be given the longest period of time to satisfy the NMLS exam requirement which is until January 1, 2011.  No getting around this — you’ll have to take the national standardized exam (and the state portion for every state you are licensed in) by Jan 1, 2011.  Email me if you want the exact citation @ jeffw@proschools.com.   The testing company Pearson VUE is putting together now the exam.

19 states will be in the first batch of states who are adopting the SAFE Act requirements which mandate a license exam and 20 hours of prelicense education for all mortgage loan originators nationwide. 

The big question for you is probably, how does this effect me?  What’s going on in my state now?  To answer these questions, I suggest you follow two links.

Link 1:  Go to http://www.stateregulatoryregistry.org/NMLS/AM/Template.cfm?Section=Participating_States1  Here you can look up your state and see what is the status of NMLS mortgage loan originator licensing for your state.  This will give you some ideas of your state’s timeline.  If your state is not on this list, you are likely going to get a bit longer to comply unless your state voluntarily complies sooner.

Link 2:  Next, go to: http://www.stateregulatoryregistry.org/AM/Template.cfm?Section=Contact_Us1&Template=/CM/ContentDisplay.cfm&ContentID=17604  Here you can find the web site link for your state to the agency that is responsible for NMLS compliance in your state.  Look for “new information” or updates at this site.  I’ve noticed that new rules are being created quickly and seemingly on the fly by states. 

Hopefully, if you put these two pieces of information together (national and state) — you can get a pretty good idea of how the new laws will effect you as a loan originator.  If you are still stuck, shoot me an email at jeffw@proschools.com and I’ll see if I can’t help.