Why Loan Originators Will Regret Missing the NMLS Uniform State Test Deadline

5 to 12 clockIf you are like most mortgage loan originators, you’ve questioned the value of taking the Stand-Alone Uniform State Test (UST). You’re probably thinking, “I originate in only one state and have no plans to expand. Why bother?” Based on the consequences, you should seriously reconsider.

It does make sense that you’d have these thoughts.  Not long ago, over 80% of the state-licensed MLOs had only one license. It just didn’t seem worth it to take the time to prepare for the test and pay more fees.

However, just because you only originate in one state doesn’t mean you always will. Here are the questions that you need to ask yourself:

-       What if something happens and my plans change?

-       What if I take a new position with a company that originates in multiple states?

-       What if I move? (Most people who live in Chicago are asking this question after 44 days of snow this winter!)

-       What if I decide not to take the Uniform State Test?

There are harsh consequences if you don’t register for the Stand-Alone UST before the deadline. Starting April 1, 2014, if you want to become licensed in any state that has adopted the UST, you won’t have a choice. You will be required to take a new National Test Component. This time, the National test will have 125 questions. Based on the failure rates, it wasn’t easy the first time and it isn’t any easier now. The safer play is to take the Stand-Alone UST. It’s only 25 questions. With some test prep, you should ace it and have no regrets.

Time is running out. All you need to do is open a test window by March 31, 2014. You don’t have to take the test by this date. You have up to 180 days after you open the test window. Don’t miss this opportunity. The reality is that 39 state regulators have already adopted the UST, and more will follow suit. If there’s a chance that you might do business in another state, register for the test.

Once you pass, you can relax and let the chips fall where they may. If you move or want to expand your business, you’ll be one step closer to satisfying that state’s requirements.

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Real Estate Institute has helped thousands of licensees pass their exams. Click here to learn more about Stand-Alone UST test prep.  A new National Test Component prep program is also available. It has been updated based on the 2014 NMLS Content Outline and includes the 2014 rule changes. Try our free online practice tests.

Click here to register for the Stand-Alone UST with the NMLS. You must schedule your test with Prometric.

NMLS Rolls Out Uniform State Test

The Nationwide Mortgage Licensing System and Registry (NMLS) has announced that the Uniform State Test (UST) will be available for enrollment beginning 4/1/2013.  As I mentioned in a previous blog post, the goal of the UST is to eliminate the need for Mortgage Loan Originators to take two tests to obtain a license under any state regulatory agency that adopts the UST program.  Although we’ve known for a year now that the NMLS was planning this initiative to streamline the licensing process (and save states the time and money involved in maintaining their own individual tests), the details have just recently become available.  Here are the critical ones you need to know:

WHICH STATE AGENCIES ARE PARTICIPATING IN THE UNIFORM STATE TEST PROGRAM?

As of this writing, the following state regulatory agencies have signed on to the UST program effective on the following dates.

State agencies allowing test enrollments beginning 4/1/2013:

Delaware New Hampshire
Georgia North Carolina
Idaho North Dakota
Indiana Department of Financial Institutions* Pennsylvania
Iowa Rhode Island
Kentucky South Dakota
Louisiana Utah Department of Financial Institutions*
Maryland Virginia
Massachusetts Washington
Michigan Wisconsin

*NOTE: Indiana Secretary of State and Utah Department of Real Estate have not elected to participate in the UST program at this time.  Licensees applying to these agencies will still be required to pass a State Component Test in order to become licensed.

Agencies allowing test enrollments beginning 7/1/2013:

Alaska
Kansas
Nebraska
Vermont

The NMLS will add agencies to this list as they sign on to the UST program.  An up-to-date list can be found by going to the NMLS Resource Center and following the links on the right-hand side of the page.

WHAT IF MY STATE AGENCY WAS NOT LISTED?

If you wish to become licensed by a state agency that has not adopted the UST, you must continue to take their State Specific Component Test. If you will be taking the National Compnent Test on or after 4/1/2013, your National Component Test will include the UST.  However, the required State Specific Component Test (for a state agency that has not adopted the UST) will need to be taken separately in order to become licensed by that state agency.

HOW DO I ENROLL FOR THE UNIFORM STATE TEST, AND WHAT IS THE FORMAT?

There is no way to enroll for the Uniform State Test until 4/1/2013.  Once that date has arrived, you will open a testing window by enrolling through the NMLS system as you would any other test.  To my surprise, the NMLS did elect to offer the UST as a stand-alone test for those who have already passed the National Test Component.  Enrollment for the stand-alone UST will only be available for the one-year period running 4/1/2013 – 3/31/2014.  After that time, any individual who has not passed some version of the UST (either the stand-alone or the National Test Component with UST) will have to enroll for (and pass) the National Test Component with UST if they want to obtain a license from any state regulatory agency that has adopted the UST.

The cost to take just the UST (which will consist of 25 questions, all of which are scored) will be $33.00.  The questions will NOT be state-specific, but rather will relate to topics that are fairly uniform across all states; many will be based off of the SAFE Act model state law created in 2008.  The full text of that law in PDF format can be found here.  If you’d like to look at the UST content outline from the NMLS, click this link.

WHAT IF I’VE ALREADY PASSED A STATE TEST IN ONE OF THE STATES LISTED?

You will continue to be able to do business as usual.  You will not need to take the UST, unless you wish to obtain a license from one of the state agencies that have adopted the UST program after the exam becomes available.

WHAT IF I’M CURRENTLY SCHEDULED TO TAKE A TEST OR HAVE AN OPEN ENROLLMENT WINDOW?

If you’re currently scheduled to take a test, or have an open enrollment window to schedule a test, you will need to take the test as-scheduled and before the end of your enrollment window or you will lose the funds you have paid to open that enrollment window.  Failure to show for a scheduled exam will also close the enrollment window.  There is no way to switch an enrollment window from a State Specific Component Test to the UST once that enrollment window has been opened and during the time it remains open.

WHAT IF I NEED TO TAKE THE NATIONAL TEST COMPONENT?

After 4/1/2013, all NEW enrollments for the National Test Component will include the UST.   The National Test Component with UST will consist of 125 questions, 115 of which will be scored. There will not be an option to take the National Test Component without the UST.  The price for all National Test Component enrollment windows opened on or after 4/1/2013 will increase to $110.

All enrollment windows for the National Test Component opened prior to 4/1/2013 will be for the existing National exam and will not include the UST.  The cost for this will remain at $92.

Until 4/1/2013, there will be no way to open an enrollment window for the National Test Component with UST.  After 4/1/2013, there will be no way to open an enrollment window for the National Test Component without the UST.  The existing National Test Component will be administered until the last enrollment window closes.

WHERE DO I FIND MORE INFORMATION?

All pertinent information relating to the UST can be found at the  NMLS Resource Center under the TESTING tab.  You can locate the UST Implementation Information page from there.

Real Estate Institute offers UST exam prep programs. Free practice tests are also available.

Happy originating!

Sharpen Your #2 Pencils - NMLS Working on Uniform State Test.

We’ve known since February that the Nationwide Mortgage Licensing System is working on a “Uniform State Test” (UST) which will allow mortgage loan originators to take one exam to make them eligible for licensure in multiple states (in conjunction with additional state-specific education requirements).  We’re hearing through the digital equivalent of a grapevine that they’re getting close to formally announcing the roll-out date.

When it’s made available, any loan originator who passes the UST will be eligible for licensure in any state that subscribes to the UST methodology.  Since the NMLS is planning on charging a fee to states that DON’T adopt the UST, we’re fairly sure that a good number of the financially-challenged states (which are some of the most populous) will sign-on.

Don’t go jumping for joy, though. Rather than being made available as a stand-alone exam, the UST would be incorporated into the existing National Component of the SAFE MLO Test. Loan originators who want to be licensed in additional states and thought their federal SAFE exam days were over may be mistaken.

We’ll be sure to provide more details as they become available.

Have a great weekend and happy originating!

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