July 2010 is a busy month for many states to meet SAFE requirements. Several state agencies have a deadline of July 30 or July 31 that MLOs must be fully compliant with the SAFE Act. This means they need to meet prelicense education, testing, and background check requirements by the deadline in order to continue working as loan originators. The NMLS anticipates this deadline could impact over 45,000 mortgage loan originators.
NMLS is guessing that approximately 135,000 mortgage originators will be licensed through the NMLS by the end 2010. So far to date, only about 64,000 individuals have passed the National Component of the SAFE MLO Test. MLOs who do not pass the National and State test components before their state deadline risk having their license terminated.
Looking at the number of LOs that have passed the SAFE Test by month, April and May of this year were big months, with 10,000 – 12,000 loan originators taking the test each month. Of course California, New York, and New Jersey had their deadlines in those months. June was just under 10,000, but then California kicked their deadline back a couple weeks into June, so I am betting there were quite a few California LOs in that number too.
If you haven’t taken your test yet, and even though your deadline seems weeks or months away, you should schedule it now to avoid the last minute rush. Plus remember, if you don’t pass your test on the first try, you have to wait 30 days before you can retake that test component. NMLS reports 71% of individuals pass the National Component on their first try.
Here is a quick look at the states with July deadlines coming up:
- South Carolina (both BFI and DCA), have July 30 deadlines, along with Tennessee. South Carolina DCA has required education in the past, so LOs may be able to get their hours certified.
- Tennessee LOs did not have to complete education or pass a state test, everyone has to pass the National and State Component of the SAFE MLO Test by July 30, 2010.
- District of Columbia LOs have to complete the education, pass the National and State Components of the SAFE MLO test by July 31, 2010.
- Delaware have till July 31, 2010 to complete their requirements. According to NMLS chart, licensees must pass the State component by a date TBD.
- Idaho loan originators approved on or after 7/1/2009 need to complete 20 hours of NMLS-approved education, pass the SAFE test, and submit fingerprints through NMLS by 7/31/2010. Existing licensees prior to 7/1/2009 have till 12/31/2010 to get it all done. One plus…Idaho may certify education that was completed prior to 12/31/2009.
- Maryland loan originators that were interim or previously exempt must complete the education, pass the State and National Test, and submit their fingerprints through NMLS for a Federal background check by 7/31/2010. Can’t originate mortgage loans on or after August 1, 2010 unless you hold an approved license without any conditions or deficiencies.
- Michigan registrants that did not complete 24 hours of state-approved education need to complete the 20 hours of NMLS education and pass the National Component of the SAFE MLO Test by 7/31/2010. The state of Michigan may certify the education and certify the state portion of the test. Check with your state if you aren’t sure how to get your hours or test certified.
- Mississippi requires anyone approved on or after 7/31/09 to complete 20 hours of NMLS approved education, including 4 hours of MS law, by 7/31/2010. They must also pass the National and State components of the SAFE Test by 7/31/2010 and submit their fingerprints for the background check.
- North Carolina licensees must pass the National and State components of the SAFE Test by 7/31/2010. However currently licensed MLOs who passed the NC test by 7/31/2009 are eligible to have their NC Component of the SAFE Test certified.
- North Dakota licensees need to complete 20 hours of state approved prelicense education, pass the National component of the SAFE Test and do the background check by 7/30/2010. Licensees have until 9/30/2010 to pass the State Component of the Test.
- New Mexico says that any individual covered by state law who does not hold an approved license with the state through NMLS or has not completed 20 hours of education, passed the SAFE MLO Test, and has not had a criminal background check review through NMLS may not originate residential mortgage loans on or after July 31, 2010.
- Oklahoma may certify education and then requires LOs to pass the National and State Components of the SAFE Test, and submit fingerprints through NMLS for the background check by 7/31/2010.