Loan originators can now access a single national exam to meet Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (SAFE Act) requirements across state borders. Through a new test announced earlier this year and launched Monday, loan originators in 20 states who are seeking licensure with their state agency will no longer be required to take a second state-specific test, according to the National Mortgage Licensing System.
On April 1, 20 states adopted the new exam including Delaware, Georgia, Idaho, Indiana, Iowa, Kentucky, Louisiana, Maryland, Massachusetts, Michigan, New Hampshire, North Carolina, North Dakota, Pennsylvania, Rhode Island, South Dakota, Utah, Virginia, Washington, and Wisconsin. Additional states will adopt the same process on July 1 and October 1. These states will no longer require a state-specific test component. States are not required to adopt the uniform test component, but several are expected to do so.
“The development and adoption of the new National SAFE MLO Test Component with uniform state test content streamlines the license process for MLOs seeking licenses in multiple states,” said Bob Entringer, Commissioner of the North Dakota Department of Financial Institutions and Chairman of the State Regulatory Registry LLC. “This is a tremendous benefit for MLOs seeking licensure in multiple states.”
The SAFE Act requires loan originators to pass its SAFE MLO test before they can be licensed with a state agency through the NMLS. Previously, loan originators were subject to two test components including a national component and a state component. Those seeking a license in a number of states would have to take a test for each of those states. Under the new system, states adopting the new exam will not require a separate state component for each state license.
The Mortgage Bankers Association said late last year it was in support of the new requirements and that they would “level the playing field” for loan originators.
Find out more about the new exam requirements.
Written by Elizabeth Ecker