Here’s what you need to do after passing the NMLS Test

By Ciprian Morariu Published: March 18, 2024

Passing the NMLS Test

Working in the mortgage industry is a rewarding and exciting career path that can pay you rich dividends in the long term. 

There is a steady demand for mortgage professionals with the required skills, knowledge, and experience. 

Did you know that you can earn as much as $80K salary annually as a mortgage loan originator? On top of it, you can earn it while having a work-life balance 

If this sounds like a dream come true, it’s time to gear up because achieving this dream is going to take proper planning. And the first step to becoming a mortgage loan originator is to pass the NMLS mortgage licensing exam

If you have done your research, you might have heard about the NMLS exam designed to test the knowledge required for the job,  

If you can clear the NMLS test, you can build a thriving and rewarding career in the mortgage and finance industry. 

In this article, we will discuss how to prepare for the NMLS test and improve your chances of passing it.  

Understanding the NMLS Mortgage Licensing Exam

Overview of the NMLS Test

After the SAFE Act was passed in 2008, all aspiring mortgage loan officers must pass the NMLS test. 

NMLS or Nationwide Mortgage Licensing System is a professional certification that is mandatory for all mortgage loan officers.  

NMLS is a centralized open-access database used by regulatory agencies to ensure that state licensing requirements are followed. Only MLOs who have passed the test and are registered members of the NMLS can work in this profession. 

Passing the NMLS test is also a must for anyone who wants to obtain a license to work in the mortgage financing industry. 

Preparing for the NMLS Test

The NMLS test might seem like a simple, straightforward test, but it is much more complicated than that. 

Preparing for the NMLS test requires focus, discipline, and proper planning as the coursework is dense and varied. 

Let us now go into the details of the format and structure of the Nationwide Mortgage Licensing System (NMLS) test.  

  • 125 multiple-choice questions of which 115 questions are scored and 10 are not. 
  • 190 minutes is allotted to complete the test. 
  • 90 questions out of 115 scored questions must be answered correctly to pass the test. That works out to a 75% grade to pass the exam. 
  • There are two sections in the exam – the national and the state components. The national section covers mortgage rules, regulations, and guidelines at the federal level. The state part deals with the local laws and regulations governing the mortgage industry.       

Tips for Passing the NMLS Test

Preparation for the NMLS test entails acquiring in-depth knowledge about both the national and state parts of the exam.  

This will help you get a comprehensive understanding of mortgage topics and the financing industry. 

Let’s look at some of the actionable tips you can put to use for passing the NMLS test: 

1. Take the pre-licensing course: 

This is the most important aspect of improving your chances of clearing the NMLS test as it covers all topics related to the mortgage field. Understanding the pre-licensing course concepts will help you clear the exam on the first try.  

Taking a pre-licensing course will give you the knowledge and skills you need to face the test with preparedness. 

A pre-licensing course requires you to give 20 hours of your time. You can enroll in an in-person college or school or join an online course provider approved by the NMLS. 

2. Complete practice questions: 

Work hard on practice questions as they mimic the real test. You will thus develop the self-assurance to face the test with great confidence. The topics covered in the practice questions are: 

  • mortgage laws 
  • knowledge of the mortgage industry 
  • state specific rules 
  • ethics and fair practices 
  • mortgage loan origination. 

Tackling an NMLS practice test course can give you access to the commonly asked questions and an overview of the frequently asked topics. 

With the help of practice questions, you can also simulate the environment of the exam day. 

This will help you manage your time effectively and make the most of the limited hours given to complete the test. 

3. Stick to a schedule: 

The key to ace an exam is to make sure you are dedicating enough time every day.  

In the NMLS test, you will face a diverse set of topics and subjects which you will learn in your pre-licensing training. 

Having a dedicated study schedule will help you plan out your day and prepare with discipline and structure. 

4. Answer all questions: 

To maximize your chances of clearing the NMLS mortgage licensing exam, you must attempt to answer all the questions. 

Remember that leaving a question unanswered means you have zero chance of getting it right. However, attempting and taking a shot at answering it might give you extra marks if your answer is correct. 

Now the key aspect here is to understand that you have a limited amount of time to tackle 115 questions. Hence tackle the simpler questions first and move on to the tougher ones.  

5. Stay relaxed: 

Taking an exam is stressful and there are no two ways about it. Especially if you are planning to take your first steps into a career. 

However, on the exam day, you must stay relaxed and composed. Unnecessary stress and worrying can take your mind off what you have learned and practiced. 

Before the day of the exam, prioritize good sleep and eating well. On test day arrive at the test center well in time to avoid any rush or stress.  

During the exam, keep yourself hydrated and take deep breaths. Remind yourself that you have what it takes to clear the exam and stay positive. 

Exploring Career Opportunities with an NMLS License

Roles and Responsibilities of Mortgage Loan Originators (MLOs)

You might be wondering after you have passed the licensing exam - I passed my NMLS test, now what? The next step is to find sponsorship so you can start working as a mortgage loan officer. This is because your NMLS license will be activated only after you start working for a lender or a financial institution.  

As a MLO, you will be responsible for performing a range of duties and responsibilities, such as:

  • Navigate borrowers through the different steps for obtaining a mortgage loan
  • Act as a link between potential borrowers and the lenders. 
  • Assist borrowers with all sorts of loan application paperwork 
  • Provide a smooth and seamless loan closing experience to borrowers
  • Provide financial guidance and mortgage loan assistance to clients
  • Verify financial and personal documents including credit history, taxes, and background. 
  • Suggest the best plans available on different mortgage options. 

In short, MLOs play a crucial role in helping borrowers get their dream homes through the best mortgage plans.  

Job Opportunities for NMLS License Holders

Many aspirants and upcoming professionals have a common question - what can you do with an NMLS license? 

Having an NMLS license is like having a gate pass to the land of job opportunities in the mortgage and finance industry. 

With a license, you can take your career to greater heights and take part in the industry without any state and federal restrictions. 

You also acquire the knowledge and skill sets required to build a successful career in this very competitive industry. 

Advantages of Having an NMLS License

An MLO career is an ideal choice if you want to work with a lender and help people get the finance to buy a house.  

To work as a mortgage loan originator, however, you will need an NMLS license which is proof that you have completed the pre-licensing coursework.  

Additionally, an NMLS license is also a testament to a clean background and lack of criminal history. 

This adds trust and authenticity to your profile and helps you provide services to borrowers seeking professional assistance.