NMLS Education and Testing 2 — Questions and Answers
Question 1: How many hours of pre-licensure education (PE) are required for a new MLO applicant under the SAFE Act?
- 12 hours
- 20 hours (Correct answer)
- 8 hours
- 16 hours
Correct answer: 20 hours
The SAFE Act mandates a minimum of 20 hours of pre-licensure education for new MLO applicants.
Question 2: Of the 20 required pre-licensure education hours, how many must cover federal law and regulations?
- 1 hour
- 2 hours
- 3 hours (Correct answer)
- 4 hours
Correct answer: 3 hours
Three of the 20 pre-licensure hours must specifically address federal law and regulations.
Question 3: What is the minimum number of pre-licensure education hours that must cover ethics?
- 1 hour
- 3 hours
- 2 hours (Correct answer)
- 4 hours
Correct answer: 2 hours
A minimum of 3 hours of the 20 required PE hours must cover ethics, including fraud, consumer protection, and fair lending.
Question 4: Which organization is approved to accredit pre-licensure and continuing education courses for MLOs?
- HUD
- CFPB
- NMLS (Correct answer)
- AARMR
Correct answer: NMLS
The NMLS is authorized to review and approve education providers and their course content for MLO licensing purposes.
Question 5: An MLO who fails the SAFE MLO Test may retake it after a waiting period. How long must they wait after a third failure?
- 30 days
- 60 days
- 6 months
- 180 days (Correct answer)
Correct answer: 180 days
After failing the test three or more times, a candidate must wait 180 days before retaking the exam.
Question 6: Which of the following topics is included in the non-traditional mortgage product component of the 20-hour PE requirement?
- Adjustable-rate vs. fixed-rate loan comparison
- Interest-only and negative amortization loans (Correct answer)
- Conventional conforming loan underwriting
- Standard 30-year amortization schedules
Correct answer: Interest-only and negative amortization loans
Three of the 20 PE hours must cover non-traditional mortgage products such as interest-only and negative amortization loans.
Question 7: An approved pre-licensure education course may be taken online. Which requirement still applies to online PE courses?
- They must be proctored in person
- They must be approved by NMLS (Correct answer)
- They must be completed within 90 days
- They must include a paper-based component
Correct answer: They must be approved by NMLS
Regardless of delivery format, all PE courses must be reviewed and approved by the NMLS before they count toward licensing requirements.
NMLS Education and Testing 2
How many hours of pre-licensure education (PE) are required for a new MLO applicant under the SAFE Act?