MLO Exam Cheat Sheet — SAFE Act Quick Reference

• Special information booklet: review §1024.6 delivery and coverage exceptions; do not confuse statutory section numbering with Regulation X sections.
• Loan Estimate versus GFE: TRID-covered transactions use Regulation Z disclosures; not every mortgage uses the same disclosure regime.
• Servicing requests: distinguish notices of error and requests for information, acknowledgement/response duties and exceptions; one universal deadline is insufficient.
• Section 8: Prohibits kickbacks, fee-splitting, and unearned fees for settlement services
• Section 9: Seller cannot require buyer to purchase title insurance from a specific company
• Section 10: Limits escrow account deposits to 2 months of cushion beyond annual obligations
• Affiliated Business Arrangement: Must disclose, borrower can choose alternative, no required use
• Marketing Service Agreement (MSA): Must provide actual services; cannot be a disguised referral fee

• Regulation Z implements TILA — applies to consumer credit transactions
• Loan Estimate must be provided within 3 business days of application (6 data points trigger)
• Closing Disclosure must be provided at least 3 business days before consummation
• Rescission under §1026.23: generally three business days after the latest required event for covered principal-dwelling transactions; purchase loans and certain same-creditor refinancings are exempt. Check scope and new-advance exceptions.
• APR accuracy: generally 1/8 percentage point; irregular-transaction tolerance and mortgage exceptions are in §1026.22. ARM does not automatically mean irregular.
• Advertising triggers: If specific credit terms are advertised, full disclosures required (Reg Z trigger terms)
• Trigger terms in ads: payment amount, number of payments, finance charge, down payment amount
• HPML and high-cost mortgage are different tests. Check the applicable lien/loan category, APR/APOR criteria, points/fees and current adjusted thresholds rather than one abbreviated threshold.

Prohibits discrimination in any aspect of a credit transaction based on:

• Home Mortgage Disclosure Act — requires reporting of mortgage data to detect discrimination
• Regulation C implements HMDA
• Applies to banks, savings associations, credit unions, and mortgage companies meeting thresholds
• Must report: applications received, loans originated, loans purchased, and applications denied
• Data collected: race, ethnicity, sex, income, loan amount, property location, loan type, action taken
• Loan Application Register (LAR) submitted annually to regulators
• Purpose: detect lending discrimination and ensure community credit needs are met
• Modified LAR available to the public (personal identifiers removed)

Prohibits discrimination in the sale, rental, and financing of housing based on 7 protected classes:

• SAFE Act = Secure and Fair Enforcement for Mortgage Licensing Act of 2008
• Requires MLOs to be either state-licensed or federally registered through NMLS
• State-licensed MLO: Works for non-depository institutions (mortgage companies, brokers)
• Federally registered MLO: Works for depository institutions (banks, credit unions)
• Pre-license education: 20 hours minimum (3 federal law + 3 ethics + 2 non-traditional + 12 electives)
• Continuing education: 8 hours annually (3 federal law + 2 ethics + 2 non-traditional + 1 elective)
• Must pass SAFE MLO exam with 75% or higher score
• Criminal background check and credit report required through NMLS
• NMLS identifiers track companies, branches and individuals. Display requirements depend on the document and applicable federal and state rules.
• Minimum licence criteria: §1008.105 distinguishes the seven-year felony condition from fraud, dishonesty, breach-of-trust and money-laundering felonies at any time; exceptions and state requirements need review.
• Renewal and CE: check current NMLS and state deadlines, extra education and late-renewal conditions; no universal 30-day CE grace period is promised.