What Education Is Required for Mortgage Loan Officers?
Looking to venture into the mortgage industry? Becoming a Mortgage Loan Officer (MLO) is the perfect first step, thanks to the role’s flexible schedule and unlimited earning potential.
To become a Mortgage Loan Officer, you must meet certain professional standards, such as being 18 years of age, completing an up-to-date criminal background check and fingerprinting, and undergoing a full credit check. These actions must be approved by the Nationwide Multistate Licensing System (NMLS) after you’ve created an NMLS account and received your NMLS ID number.
Along with these professional requirements, there is also education you must complete to become a licensed MLO.
Pre-Licensure Education (PE) is the first coursework you are required to complete once you’ve set up your NMLS account. Pre-Licensure coursework must be taken with an NMLS-approved provider and consists of a minimum of 20 hours of national education, with at least 8 of these hours covering specific topics and fulfilling set elective hours. While a majority of the Pre-Licensure content is national, many states necessitate an additional 1-5 hours of state-specific education.
In some instances, your PE will expire and you’ll have to retake it. For example, this could happen if you:
- Don’t obtain your MLO license within three years of completing PE
- Leave the industry and return after an extended period of time
It’s important to note that national Pre-Licensure education must be completed within 14 days of starting the course — but don’t worry. It’s possible to take your MLO education online, allowing you to earn your license from the comfort of your home when it works with your schedule.
SAFE MLO Test
Once you’ve completed your PE, it’s time to prepare for the SAFE MLO Test. This exam will determine your licensure, as passing it is necessary in order to apply for your MLO license.
Before scheduling your test, you will have to pay the $110 fee and accept the Candidate Agreement. The 190-minute exam consists of 120 multiple choice questions and is available online or in person. To pass, you must achieve a score of 75% or higher, but you do have the ability to retake the test as needed. NMLS has provided a Test Outline and an MLO Testing Handbook to aid in your study efforts. You can also seek out comprehensive Exam Prep to help you feel more confident on test day.
It is important to note that if you do not maintain a valid MLO license for five consecutive years, you will be required to retake the SAFE MLO Test.
After you’ve passed the SAFE MLO Test and received your license, you’ll need to take annual Continuing Education (CE) courses to maintain your MLO license. You will not need to complete CE within the same year as your PE and SAFE MLO Test. Every MLO must complete 8 hours of nationally approved Continuing Education annually, as well as any state-specific CE. The 8 required hours of CE must include:
- 3 hours of Federal Law and Regulations
- 2 hours of Ethics (including instruction on fraud, consumer protection, and fair lending issues)
- 2 hours of training related to Lending Standards for the Nontraditional Mortgage Product Market
- 1 hour of instruction on Mortgage Origination
There are six states that require additional CE, so be sure to check on your states’ requirements. The deadline for Continuing Education is 12/31 each year, although some states have an earlier deadline.
MLO online education is delivered in one of two ways: via online self-study (OSS) and online instructor-led (OIL) courses. OIL courses are designed and delivered so the instructor leads the course through instructor-to-student or student-to-student interaction, and this style is only used for national Pre-Licensing coursework. OSS-style courses provide videos, text slides, and/or learning-based inquiries to guide students through the coursework, and this style is available for state-specific Pre-Licensing curricula and all Continuing Education courses.
Starting your mortgage education and keeping it up to date is crucial to finding success as an MLO. This industry is constantly changing, which is why the best professionals never stop learning. If you’re hungry for more mortgage information, check out our free Mortgage Essentials resource hub.
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