A licensed MLO joins a new mortgage company. Before the company can sponsor the individual's license in NMLS, what must occur?
Correct Answer
C) The company must obtain access to the individual's record and establish the required relationship
Why this is correct: In the NMLS, sponsorship is the process where a company authorizes an individual to act as an MLO on its behalf. For a new company to sponsor an MLO, it must first obtain administrative access to the individual's existing NMLS record and then establish the sponsorship relationship within the system. The individual's record and unique identifier remain constant. Why the other choices are wrong: The MLO must create a second unique identifier is false because an individual has only one permanent NMLS unique identifier. The borrower must approve the employment change is incorrect; borrower approval is not required for sponsorship, which is an administrative relationship between the MLO and the company. The prior employer must transfer its own company license is wrong; a company license is not transferred; sponsorship is managed through the individual's record. Exam tip: Sponsorship is about company access to the individual's record. The unique identifier stays with the person, not the employer.
Why This Is the Correct Answer
Why this is correct: In the NMLS, sponsorship is the process where a company authorizes an individual to act as an MLO on its behalf. For a new company to sponsor an MLO, it must first obtain administrative access to the individual's existing NMLS record and then establish the sponsorship relationship within the system. The individual's record and unique identifier remain constant. Why the other choices are wrong: The MLO must create a second unique identifier is false because an individual has only one permanent NMLS unique identifier. The borrower must approve the employment change is incorrect; borrower approval is not required for sponsorship, which is an administrative relationship between the MLO and the company. The prior employer must transfer its own company license is wrong; a company license is not transferred; sponsorship is managed through the individual's record. Exam tip: Sponsorship is about company access to the individual's record. The unique identifier stays with the person, not the employer.
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