NMLS Uniform State Content (USC) 2 — Questions and Answers
Question 1: Under the SAFE Act's Uniform State Content, what is the minimum number of hours of pre-licensure education required for mortgage loan originators?
- 12 hours
- 18 hours
- 20 hours (Correct answer)
- 24 hours
Correct answer: 20 hours
The SAFE Act requires a minimum of 20 hours of pre-licensure education for MLOs, including specific hours in federal law, ethics, and nontraditional mortgage products.
Question 2: Which entity is primarily responsible for maintaining the Nationwide Multistate Licensing System (NMLS)?
- The Federal Reserve
- The Conference of State Bank Supervisors (CSBS) (Correct answer)
- HUD
- The Consumer Financial Protection Bureau (CFPB)
Correct answer: The Conference of State Bank Supervisors (CSBS)
The Conference of State Bank Supervisors (CSBS) and the American Association of Residential Mortgage Regulators (AARMR) developed and maintain NMLS.
Question 3: A mortgage loan originator who wants to move from one state-licensed company to another must:
- Obtain a new license from scratch in the new state
- Submit a new sponsorship request through NMLS (Correct answer)
- Retake the SAFE MLO test
- File a surety bond in the new company's name
Correct answer: Submit a new sponsorship request through NMLS
When changing employers, an MLO must submit a new sponsorship request through NMLS to associate their existing license with the new company.
Question 4: Under USC standards, a felony conviction involving fraud, dishonesty, or breach of trust within the past how many years will disqualify an MLO applicant?
- 5 years
- 7 years
- 10 years (Correct answer)
- The applicant is permanently barred
Correct answer: 10 years
The SAFE Act disqualifies applicants with a felony involving fraud, dishonesty, or breach of trust within the past 10 years, though certain felonies result in permanent disqualification.
Question 5: What does the USC require regarding continuing education for licensed MLOs?
- 8 hours annually
- 12 hours every two years
- 8 hours annually with specific topic requirements (Correct answer)
- 20 hours annually
Correct answer: 8 hours annually with specific topic requirements
Licensed MLOs must complete 8 hours of continuing education annually, including courses on federal law, ethics, and nontraditional mortgage products.
Question 6: Which of the following is NOT a required component of the 20-hour pre-licensure education under the SAFE Act?
- 3 hours of federal law
- 3 hours of ethics
- 2 hours of nontraditional mortgage products
- 5 hours of state-specific law (Correct answer)
Correct answer: 5 hours of state-specific law
The SAFE Act mandates 3 hours federal law, 3 hours ethics, and 2 hours nontraditional mortgage products; state-specific hours vary and are not a fixed 5-hour federal requirement.
Question 7: Under the Uniform State Content, an MLO license applicant must authorize NMLS to obtain:
- A credit report only
- A criminal background check only
- Both a credit report and a criminal background check (Correct answer)
- A tax transcript from the IRS
Correct answer: Both a credit report and a criminal background check
NMLS requires applicants to authorize both a credit report and an FBI criminal background check as part of the licensing process.
NMLS Uniform State Content (USC) 2
Under the SAFE Act's Uniform State Content, what is the minimum number of hours of pre-licensure education required for mortgage loan originators?