How to Become a MLO in Utah

The mission of the Utah Division of Real Estate (DRE) is to protect public the public and promote responsible business practices through education, licensure, and regulation of real estate, mortgage, and appraisal professionals.

Total DRE MLOs in Utah:
Annual Percentage Change:

6,248
7.8%

Short Answer

  1. Complete the Pre-Licensure Education (PE)
  2. Pass the National Exam with Uniform State Content
  3. Submit your License Application (Includes a background check and credit report)
  4. Obtain a company sponsorship

From start to finish, the entire process takes about 6 weeks to 8 weeks.

Long Answer

Basic Requirements

  • You need to be at least 18 years or older.
  • A high school diploma, or equivalent, is required.
  • Meet the statutory licensing qualifications of good moral character, competency, honesty, integrity, and truthfulness

1. Complete the Pre-Licensure Education (PE)

The Utah DRE requires you to complete 20 hours of NMLS-approved education.  15 out of these 20 hours must be approved by Utah.

The subjects must include the following:

  • 2 hours – Non-traditional mortgage lending
  • 3 hours – Federal Law
  • 3 hours – Ethics (Includes fraud, consumer protection, and fair lending issues)
  • 12 hours – Elective topics of your choice

Before you start your education, the first thing your education provider will have you do is obtain an NMLS ID# if you don’t have one. It’s a very easy process and the best part is it’s free.

If you already have NMLS ID #, you’ll just continue using the one you have.

This will be important when you’re done with the course, because your education provider will be submitting your certificates to the NMLS with your unique NMLS ID #. 

There’s only one program that’s in a live classroom in the entire state, so your best will probably to do this online. They typically range from 5 days to 14 days.

If you take an online program, you’ll have to log at least 16.67 total hours online. The NMLS has also implemented measures to make sure you’re paying attention. For instance, if your mouse cursor is idle for more than 6 minutes, you will be logged out automatically.

2. Pass the National Exam with UST

You don’t technically have to take the PE before the National Exam. However, it will be beneficial to take the exam after the course because you will learn things in the course that will help you understand the questions better on the exam.

Prometric has been selected by the NMLS to administer their exams. They are a national testing company, so it will be easy to find a location that is close to you.

The National Exam with UST consists of 125 multiple-choice questions. You have 190 minutes to score a 75% or better to pass. The exam fee is $110.

The first step to applying for the National Exam with UST is to enroll on the NMLS website, where you’ll pay the $110 testing fee.

Once you’ve enrolled, you can schedule an exam on Prometric’s website or by calling them at (877) 671-6657.

You have 180 days to take the exam from the date that you enrolled on the NMLS website. Otherwise, you will have to repay the $110 exam fee again.

I’ll be honest with you. A lot of people struggle with this exam. The pass rate is a meager 58% for people who take the test on their first time as you can see from the table below.

National Exam with UST Pass Rates

 Tests TakenTests PassedPass Rate
1st Attempt61,79835,91858%
Subsequent Attempts27,11011,57043%
Overall88,90847,48853%
Source: NMLS; Tests administered between 1/1/2017 to 12/31/2018

 

Why are pass rates so low?

It’s simple. Most people either don’t study enough or study the right material.

Keep in mind, this exam is testing you on the most current laws and regulations. In February 2018, Congress passed major changes to the TILA-RESPA Integrated Disclosure (TRID) rule. A large portion of the National Exam with UST covers this, and unless you are current on this, you will have difficulty passing this part.

If you don’t pass, you can re-take it but there is a waiting period of 30 days. If you fail Attempt #2, you have to wait another 30 days. If you fail Attempt #3, you have to wait 180 days.

3. Submit Your License Application

After you successfully pass the exam, you will be ready to submit your application.

Complete the Multistate Uniform Individual License Form (MU4 FORM) online at the NMLS website.

This is a generic application form that includes your contact information, employment history, and any financial or criminal disclosures you need to report. The current application fee is $199.25.

You will also have to get your fingerprints taken so that they can run a federal background check with the FBI. You have to go to a NMLS authorized Live Scan Provider. You can schedule your fingerprinting appointment here.  It’s a quick process and results are back within 48 hours. The Live Scan fee is $36.25.

They are looking for criminal activity such as felonies involving an act of fraud, dishonesty, or a breach of trust, or money laundering.

They will conduct a comprehensive review of your credit history. They want to see that you have demonstrated financial responsibility, character, and general fitness such as to command the confidence of the community and to warrant a determination that the loan originator will operate honestly, fairly, and efficiently within the purposes of this title.

There is no minimum credit score or automated grading system for determining if someone passes the credit check. The SAFE Act gives each state regulator the broad discretion to review and determine what financial responsibility looks like. So, every state has different criteria, and they don’t publish what these standards are.

The credit report fee is $15

If you are concerned about this, you can check your own credit before you send it. There is a lot of free credit reporting options nowadays. You can get your free annual report from www.annualcreditreport.com.

4. Obtain A Company Sponsorship

Once you have submitted everything above to the NMLS, your license status will be “Approved-Inactive.” While under this status, you are not allowed to conduct any business under the authority of the Utah-DRE MLO license.

To change your status to “Approved-Active,” you will need to get your employer to submit a sponsorship request to the DRE. They review the request and either accept it or reject it.

After your sponsor is approved by the DRE, you will be a licensed Mortgage Loan Originator in Utah!