Course Syllabus

Course Title: 20 Hour SAFE Comprehensive: 20 Hour MLO Prelicensure Course

Requirement For Text Or Other Course Materials: The course instructional materials and course syllabus are available for download.

Completion Requirements

This online instructor-led 20-hour prelicensure course is delivered within a scheduled course offering that has a defined start date and end date. New course offerings begin daily at 9:00 AM ET. Each course offering is 13 days in duration, during which students must complete all required activities.

This course includes timed modules designed to satisfy NMLS seat time requirements. Students must actively engage with all instructional content and complete all required activities as scheduled. Periods of inactivity may result in session timeout, and inactive time will not count toward required course time.

To successfully complete the course, students must complete all of the following:

Section Requirements

Complete each course section in the order presented
Complete the 5-question quiz at the end of each section
Earn a minimum score of 60% on each section quiz to continue
Complete each section quiz within a maximum of 3 attempts
Complete the case study quiz included at the end of each major content area, including Federal Law, Ethics, Non-Traditional Mortgage Lending, and Electives.
Earn a minimum score of 60% on each case study quiz to continue
Complete each section quiz within a maximum of 3 attempts

Discussion Requirements

This course requires continual and obvious instructor-to-student and student-to-student interaction throughout the entire course offering.
Students must participate in ongoing discussion activities scheduled throughout the course, rather than only at the end of the course.
Required discussion activities are integrated throughout the course across the major content areas, including Federal Law, Ethics, Non-Traditional Mortgage Lending, and Electives. At designated points within and following each content area, students are required to participate in instructor-led discussion activities before progressing further in the course.
For each required discussion activity, students must submit one substantive original response and at least one substantive peer response.
Discussion responses must demonstrate understanding, analysis, and application of the course material.
The instructor actively leads and maintains dialogue throughout the course by facilitating substantive discussion, responding to student questions, and providing knowledgeable feedback.
All required discussion activities must be completed successfully in accordance with the course schedule in order to receive course credit.

Final Exam Requirements

Complete the 25-question final exam
Earn a minimum passing score of 70%
Complete the final exam within a maximum of 3 attempts
Receive a new set of exam questions for each attempt
If a passing score is not achieved after 3 attempts, the student must retake the course before credit may be awarded

Credit Reporting

NMLS credit will be reported only after the student has fully completed all course requirements
Full completion includes required instructional time, all required quizzes, all required discussion activities, all required case studies, and a passing final exam
Credit will be submitted to NMLS within 7 calendar days after successful course completion

Academic Integrity

All coursework must be completed by the enrolled student
Students must complete all work independently unless a course activity expressly requires interaction
Any attempt to bypass course controls, misrepresent identity, submit work not completed by the enrolled student, or engage in dishonest conduct may result in termination from the course without credit

Attendance Requirements

Students are required to attend and actively participate in all scheduled components of the course within the defined course offering period. Attendance is measured through a combination of seat time tracking, course progression, and completion of required activities.

To receive credit, students must:

Complete all required instructional time in accordance with NMLS seat time requirements
Complete all quizzes, case studies, discussions, and the final exam
Actively engage with course content and required interactions throughout the course

Periods of inactivity may result in session timeout, and time spent inactive will not count toward required course time.

Participation Requirements

This course is delivered in an online instructor-led (OIL) format and requires ongoing interaction. Students are required to:

Participate in instructor-led discussions
Submit substantive responses demonstrating understanding of course material
Engage with course activities as directed throughout the course schedule

Failure to participate meaningfully in required activities may result in denial of course credit.

Behavior and Academic Integrity

Students are expected to complete all coursework independently and in accordance with NMLS Standards of Conduct.

The following are prohibited:

Sharing answers or collaborating on graded assessments
Attempting to bypass seat time, timers, or course controls
Misrepresenting identity or allowing another individual to complete course work
Engaging in any dishonest or unethical behavior

Violation of these policies may result in removal from the course without credit and may be reported as required.

Technology Requirements

To successfully complete this course, students must have access to the following:

Hardware and Connectivity

A computer capable of accessing the course platform
Reliable internet connection sufficient for streaming content and participating in course activities

Software Requirements

A current version of a supported web browser (e.g., Chrome, Firefox, Safari, or Edge)
Access to email for course communications and notifications

Authentication and System Requirements

Students must complete all required identity verification and authentication steps as prompted throughout the course
Browser settings must allow cookies, JavaScript, and other required course functionalities
Disabling course functionality or authentication features may prevent successful completion of the course

Additional Notes

Some course features may not function properly on outdated devices or unsupported browsers
Students are responsible for ensuring their technology meets these requirements prior to enrollment

Course Description

This national prelicensure course provides the full 20 hours of instruction for prospective mortgage loan originators, including 3 hours of federal law, 3 hours of ethics, 2 hours of non-traditional mortgage lending, and 12 hours of electives. The curriculum covers mortgage regulations, consumer-focused practices, loan programs, disclosures, qualification fundamentals, mortgage math, and core origination processes through instructional lessons, review questions, case studies, and a comprehensive final exam.

Course Completion Requirements

Module 1: Orientation

Time Allocation: 1 minute

Lessons

Course Information
Rules of Conduct for NMLS Education

Module 2: Ethics - Violations of law

Time Allocation: 5 minutes

Learning Objectives

Identify, in a mortgage-company disclosure scenario, whether sharing nonpublic personal information with a nonaffiliated third party is permitted under GLBA or creates violation risk.

Lessons

Learning Objectives
Violations of the Gramm-Leach-Bliley Act
Review Questions
Case Study

Module 3: Ethics - Prohibited acts

Time Allocation: 20 minutes

Learning Objectives

Identify lending practices that may indicate redlining when a lender limits access to mortgage credit by neighborhood, discourages applications, or uses geography as a proxy for race or national origin.
Differentiate lawful from unlawful RESPA compensation arrangements in mortgage-origination scenarios by identifying whether a payment reflects actual, necessary, and distinct work rather than the value of referred business.
Identify the three recurring prohibited-act patterns in mortgage origination: deceptive statements or omissions, steering based on compensation, and discriminatory discouragement.
Identify whether a request for personal information is proper by determining whether it serves a lawful, business-related purpose connected to the credit transaction.
Distinguish lawful payment for real settlement-related services from an unlawful kickback by evaluating whether compensation is actually for referrals, duplicative work, or nominal work rather than fair-value services.
Distinguish whether a loan processor's task remains processing or becomes origination by determining whether the task gathers or moves information or instead shapes the consumer's choice among loan terms.

Lessons

Learning Objectives
Examples of redlining
Acceptable and non-acceptable practices under RESPA
Examples of prohibited acts
Requests for personal information
Examples of kickbacks
Duties a loan processor may and may not perform
Review Questions
Case Study

Module 4: Ethics - Predatory lending and steering

Time Allocation: 5 minutes

Learning Objectives

Define steering in mortgage lending by identifying when a recommendation pushes a consumer toward a loan, creditor, or terms for reasons that do not align with the consumer's interests.

Lessons

Learning Objectives
Definition of steering
Review Questions
Case Study

Module 5: Ethics - Fair lending

Time Allocation: 10 minutes

Learning Objectives

Identify when less favorable treatment or discouragement on a prohibited basis during any part of a mortgage credit transaction constitutes discrimination.
Distinguish fair, credit-related differences from unfair personal-factor differences in the process, explanations, and assistance given to similarly situated mortgage applicants.

Lessons

Learning Objectives
Discriminating against an applicant
Treating all applicants with the same level of fairness
Review Questions
Case Study

Module 6: Ethics - Truth in marketing and advertising

Time Allocation: 15 minutes

Learning Objectives

Explain when a mortgage advertisement is misleading by identifying whether its overall message gives a reasonable consumer a false or incomplete understanding of the loan, its cost, its source, or the likelihood of approval.
Explain when a mortgage advertisement becomes bait-and-switch by distinguishing an insincere advertised offer from a real offer the company is prepared to honor when disclosed assumptions are met.
Explain how UDAAP review evaluates a mortgage advertisement's overall message, including when fine print fails to correct a misleading headline or omitted material limit.
Identify whether a mortgage advertisement presents federal compliance risk by being inaccurate, misleading by implication or omission, or discriminatory when reviewed as a complete communication.

Lessons

Learning Objectives
Misleading information in advertisements
Bait-and-switch scenarios
Unfair, deceptive, or abusive acts in advertising
Advertisements subject to federal regulation
Review Questions
Case Study

Module 7: Ethics - Borrower education

Time Allocation: 5 minutes

Learning Objectives

Differentiate known loan terms from estimates and later-review contingencies when explaining approval, payment, or cash-to-close expectations to a borrower.

Lessons

Learning Objectives
Ethical borrower education and expectation setting
Review Questions
Case Study

Module 8: Ethics - Fraud detection

Time Allocation: 25 minutes

Learning Objectives

Identify application facts or inconsistencies that should be treated as red flags requiring more review before the file moves forward.
Determine which income or asset facts in a loan file must be independently verified when the creditor relies on them for qualification, reserves, or funds to close.
Identify whether a stated occupancy presents a potential occupancy-fraud issue by determining whether the stated occupancy matches the borrower’s real plan at the time of application and closing.
Determine when income in a loan file should stop being treated as confirmed until reliable third-party support is obtained and the file documents why the income is included or excluded.
Apply the lesson's red-flag framework to identify cumulative patterns of inconsistency, concealment, or third-party control that require independent verification before a loan proceeds.
Identify when available facts in a mortgage file create a reasonable basis for internal escalation and possible reporting as suspicious activity.

Lessons

Learning Objectives
Application red flags
Verifying loan application information
Occupancy fraud
Income fraud
General fraud red flags
Suspicious activity
Review Questions
Case Study

Module 9: Ethics - Financial responsibility

Time Allocation: 15 minutes

Learning Objectives

Explain when a creditor may collect application-related fees by identifying the narrow credit-report exception and the requirement that the consumer receive the Loan Estimate and indicate an intent to proceed before other fees are charged.
Differentiate the three Loan Estimate tolerance categories to determine whether a closing-cost charge may not increase, may increase only within the 10 percent aggregate cap, or may change without a numerical cap.
Determine whether a settlement can proceed before consummation by verifying that each dollar serves a lawful, disclosed, and documented purpose and that each charge matches an actual service or allowable escrow item.
Evaluate whether a compensation arrangement in a mortgage transaction creates referral-fee risk by determining whether it involves a thing of value, a referral, an agreement or pattern, and payment for actual services rather than steering business.

Lessons

Learning Objectives
Permitted fees, payments, and compensation, including the Loan Estimate
How fees are handled based on the Loan Estimate
Settlement scenarios where monies are missing or misused
Referral fee scenarios
Review Questions
Case Study

Module 10: Ethics - Handling consumer complaints

Time Allocation: 5 minutes

Learning Objectives

Explain the four elements that should appear in a sound written response to a consumer complaint: the issue, investigation summary, conclusion, and corrective action or next step.

Lessons

Learning Objectives
Responding to consumer complaints
Review Questions
Case Study

Module 11: Ethics - Mortgage company compliance

Time Allocation: 10 minutes

Learning Objectives

Explain that once an MLO discovers information that could affect underwriting, the MLO must communicate and document it promptly instead of treating the earlier approval as still based on current facts.
Differentiate compliant consumer-interest loan recommendations from prohibited compensation-driven steering when comparable options are available through the same channels.

Lessons

Learning Objectives
When an MLO discovers material information that should be conveyed to the lender
Requirements for MLOs
Review Questions
Case Study

Module 12: Ethics - Relationship with consumers

Time Allocation: 20 minutes

Learning Objectives

Evaluate whether a proposed disclosure of a customer's nonpublic personal information is ethically appropriate by checking whether it is necessary, authorized, and limited to the information needed.
Determine whether an MLO's request for a credit report is permissible by identifying whether the file shows a lawful purpose, consumer authorization when applicable, and a real lending need.
Explain why a known change that could affect qualification, pricing, or disclosures must be reported promptly to the underwriter.
Distinguish compliant affiliated-business referrals from improper conflicted referrals by identifying the required timing and content of the disclosure and recognizing when disclosure does not cure a RESPA problem.
Apply ethical income-handling practices by separating reported from documented income, preserving records without alteration, and escalating meaningful discrepancies during intake and later updates.
Identify, in a mortgage-file scenario, when an unusual request or data-handling shortcut should be treated as a possible security event instead of routine processing.

Lessons

Learning Objectives
Ethical handling of a customer's personal information
Permissible reasons for requesting a credit report
Notifying the underwriter of changes in the borrower's application or status
MLO disclosures when there is a potential conflict of interest
Borrower-provided income information scenarios
Cybersecurity scenarios
Review Questions
Case Study

Module 13: Ethics - General business ethics

Time Allocation: 15 minutes

Learning Objectives

Apply the lesson's practical response steps to determine when an MLO should pause a file, obtain clarification, and move the matter to underwriting review, compliance escalation, or withdrawal.
Apply the distinction between legitimate correction and falsification by determining whether an MLO changed a material fact only after obtaining a truthful, documented basis.
Apply the lesson's process when an outside party requests loan or borrower information by verifying identity and authority, limiting disclosure to the minimum necessary, using approved secure channels, and escalating unclear requests.

Lessons

Learning Objectives
Borrower false information scenarios
MLO falsifying information on behalf of a borrower
Outside parties attempting to obtain loan or borrower information
Review Questions
Case Study

Module 14: Federal Law - Real Estate Settlement Procedures Act (RESPA), 12 CFR Part 1024 (Regulation X)

Time Allocation: 15 minutes

Learning Objectives

Distinguish in introductory settlement-service scenarios between lawful compensation for actual services and unlawful value tied to referrals or sham fee splits under RESPA.
Differentiate loans that are generally covered by RESPA from commonly exempt transactions by examining the collateral, whether the transaction creates or changes a covered residential mortgage obligation, and whether a specific Regulation X exemption applies.
Apply the functional RESPA analysis to determine whether a described mortgage-related activity is a settlement service by asking whether it is connected to the transaction and helps move the loan toward closing or performs a closing-related task.
Identify whether a borrower submission qualifies as an application under Regulation X by checking for the six listed borrower information items.

Lessons

Learning Objectives
Knowledge of the prohibitions, limitations, and exemptions set by RESPA
Types of loans to which RESPA is applicable
Settlement services
Required information from a borrower that must be included on an application (Regulation X)
Review Questions
Case Study

Module 15: Federal Law - Equal Credit Opportunity Act (ECOA), 12 CFR Part 1002 (Regulation B)

Time Allocation: 25 minutes

Learning Objectives

Identify whether a lending action violates Regulation B when marital status or qualifying public assistance income is used to steer applicants or discount income.
Differentiate when a creditor should treat a mortgage file as incomplete versus deny it based on creditworthiness so the notice matches the real basis for the decision.
Identify when ECOA allows a creditor to deny credit because the decision is based on neutral underwriting, repayment risk, collateral concerns, or missing file support rather than a prohibited basis.
Identify the mandatory components of a written adverse action notice under Regulation B, including the extra contact-point requirement when the creditor uses a right-to-request notice instead of listing specific reasons.
Distinguish whether a creditor response is adverse action in three scenarios: outright rejection, an unaccepted offer on materially different terms, and an accepted or used counteroffer.
Identify whether mortgage-lending conduct violates Regulation B when it discriminates or discourages on a prohibited basis during advertising, interviews, document requests, underwriting, pricing, servicing, or collection.
Analyze a lending scenario by comparing similarly qualified applicants, identifying any difference in treatment, and determining whether the difference is tied to a prohibited basis rather than a documented risk factor.
Identify which application-review factors Regulation B treats as legitimate indicators of creditworthiness when they are tied to repayment capacity and applied consistently.
Classify when a mortgage counteroffer outcome becomes adverse action based on whether the applicant accepts, rejects, or never uses the offered credit.
Explain the 30-day requirement to notify an applicant of action taken after receiving a completed application.

Lessons

Learning Objectives
Factors that cannot be used to discriminate
Notifying a borrower of action taken
Circumstances when it is acceptable to deny credit or a loan
Components of a notice of adverse action
Definition of adverse action
General provisions of Regulation B
Disparate treatment scenarios
Factors considered when determining creditworthiness
Adverse action scenarios
Timeframe for sending an adverse action to an applicant
Review Questions
Case Study

Module 16: Federal Law - Truth in Lending Act (TILA), 12 CFR Part 1026 (Regulation Z)

Time Allocation: 30 minutes

Learning Objectives

Determine when the rescission period begins and expires in a covered transaction by using the latest triggering event and checking whether the notice and material disclosures were properly delivered.
Apply the lesson's review sequence to determine whether a mortgage-related charge remains in the finance charge or qualifies for a specific exclusion.
Identify the additional disclosures a mortgage advertisement generally must provide when it states a triggering term, including APR wording and any balloon payment obligation.
Identify whether a loan is generally covered by TILA by applying the lesson's consumer-purpose, finance-charge/installment, and creditor criteria.
Identify whether a fee is a finance charge by applying the comparable cash transaction test to determine whether the fee exists because credit is being extended.
Differentiate APR from the note rate by identifying that the note rate is the contract rate used to calculate interest on unpaid principal, while APR is a disclosure rate built from the finance charge and the amount financed.
Distinguish whether a loan on a single-family property is generally consumer credit covered by TILA or business-purpose credit usually exempt from TILA by determining whether the property will be used as the borrower's principal residence or rented to others and not owner-occupied.
Differentiate whether a refinance secured by a principal dwelling is exempt from rescission, partially rescindable, or generally rescindable by identifying whether the creditor is the same and whether a new advance was added.

Lessons

Learning Objectives
Notice of right to rescind
Permissible fees and finance charges
Advertisement requirements
Knowledge of the core concepts of the Truth in Lending Act
Definition of finance charge
Definition of annual percentage rate
Loans covered by the Truth in Lending Act
Refinancing scenarios with rights to rescind certain transactions
Review Questions
Case Study

Module 17: Federal Law - Home Ownership and Equity Protection Act (HOEPA) - High-Cost Mortgages, Section 32 and 12 CFR Part 1026

Time Allocation: 5 minutes

Learning Objectives

Identify the four conditions that must be satisfied before a HOEPA high-cost loan may still close: timely special disclosures, the required repayment-ability standard, counseling certification, and removal of prohibited terms.
Identify whether a purchase-money mortgage, refinance, closed-end home-equity loan, or HELOC may be subject to HOEPA by determining whether the transaction fits the dwelling and consumer-purpose limits and crosses a HOEPA trigger.

Lessons

Learning Objectives
What is allowed under HOEPA
Types of loans and lines of credit subject to HOEPA
Review Questions
Case Study

Module 18: Federal Law - Higher-Priced Mortgage Loans, 12 CFR 1026.35

Time Allocation: 5 minutes

Learning Objectives

Classify a principal-dwelling loan scenario as an HPML, a high-cost mortgage, both, or neither by checking whether it is closed-end, whether its APR exceeds the applicable APOR margin under 1026.35, and whether it crosses a 1026.32 high-cost trigger.
Identify which HPML protection is triggered in a given mortgage scenario by choosing among escrow, appraisal, and anti-evasion requirements.

Lessons

Learning Objectives
Definition of a higher-priced or high-cost mortgage
Prohibitions within higher-priced mortgages
Review Questions
Case Study

Module 19: Federal Law - Loan Originator Compensation, 12 CFR 1026.36(d)

Time Allocation: 5 minutes

Learning Objectives

Identify whether an MLO compensation plan based on loan amount is permitted when the percentage remains fixed and any floor or cap does not vary by transaction terms.
Differentiate between prohibited dual compensation and the narrow internal-payment exception when a consumer pays a loan originator organization.

Lessons

Learning Objectives
MLO compensation basis
The rules for who may compensate an MLO
Review Questions
Case Study

Module 20: Federal Law - TILA-RESPA Integrated Disclosure Rule (TRID), Know Before You Owe

Time Allocation: 50 minutes

Learning Objectives

Differentiate TRID changes that restart the Closing Disclosure waiting period from pre-consummation inaccuracies that require only a corrected Closing Disclosure.
Explain TRID's core required disclosures by naming the Loan Estimate and Closing Disclosure, defining a disclosure as a federally prescribed statement of loan terms and settlement costs, and stating that the rule replaced earlier overlapping forms to provide a uniform early estimate and final statement before consummation.
Identify whether an application exists under Regulation Z and whether the Loan Estimate timing rule is triggered once the six required application items have been received.
Identify whether a scenario matches one of the lesson's listed other narrow situations that permit a revised Loan Estimate under TRID.
Identify when a TRID application exists and who remains legally responsible for Loan Estimate compliance when a broker delivers the disclosure.
Explain how a valid eligibility change limits a revised Loan Estimate to the specific charge increased by that triggering event.
Identify the six pieces of information that constitute an application under TRID and determine that receipt of the sixth item creates an application.
Explain that a broker's delivery of the Loan Estimate does not transfer the creditor's ultimate legal responsibility to ensure the disclosure complies with Regulation Z.
Apply TRID application-trigger rules in a loan-file scenario to determine when Loan Estimate timing begins and whether missing verifying documents can lawfully delay disclosure.
Differentiate valid and invalid bases for a revised Loan Estimate by determining whether a file change reflects a permitted TRID event, such as a rate lock or delayed settlement, rather than the creditor's own fee error.
Distinguish consummation from signing, settlement, funding, and recording by identifying the state-law point when a consumer becomes contractually obligated and the Closing Disclosure deadline tied to that point.
Identify the required first-page Loan Estimate disclosures for transaction identity, lock status, and core loan terms.
Identify when the six-item TRID application threshold has been met and the creditor's general duty to deliver or mail the Loan Estimate within three business days has begun, without waiting for additional documents.
Differentiate the Loan Estimate's prepaids, initial escrow payment at closing, and "Other" subgroup by classifying charges based on when the money is used and whether it fits an earlier subgroup.
Identify how the Closing Disclosure separates Loan Costs from Other Costs and how its cash-to-close sections show payment responsibility, credits, and the borrower’s final cash due at closing.

Lessons

Learning Objectives
Disclosure timeframes
Required disclosures
Timing of disclosures provided to an applicant
Circumstances under which a Loan Estimate may be amended
General information about the TILA-RESPA Integrated Disclosure Rule
Examples of change of circumstance
Borrower information included on an application
Party required to provide the Loan Estimate
Actions an MLO must take when TRID disclosures contain incomplete information
TRID violation scenarios
Definition of loan consummation
Information that must be disclosed on a Loan Estimate
Facts about the Loan Estimate
Charges and fees disclosed
Information included on a Closing Disclosure
Review Questions
Case Study

Module 21: Federal Law - Home Mortgage Disclosure Act (HMDA), 12 CFR Part 1003 (Regulation C)

Time Allocation: 10 minutes

Learning Objectives

Apply HMDA rules for collecting ethnicity, race, and sex by identifying when the institution must ask, when it cannot require a response, and how missing data is handled in person versus remote channels.
Identify the compliant HMDA response when a remote applicant declines demographic questions by coding the information as not provided and avoiding estimates from the applicant's name, questions about religion or national origin, and demands for an explanation.

Lessons

Learning Objectives
Information included in borrower data
Information about which an MLO should not inquire
Review Questions
Case Study

Module 22: Federal Law - Fair Credit Reporting Act (FCRA) and Fair and Accurate Credit Transactions Act (FACTA), 15 USC 1681 et seq.

Time Allocation: 5 minutes

Learning Objectives

Classify common consumer report entries as identifying information, account information, or other listed report items during mortgage-file review.

Lessons

Learning Objectives
Information included in a consumer report
Review Questions
Case Study

Module 23: Non-Traditional Mortgage Lending - Conventional and conforming loans

Time Allocation: 25 minutes

Learning Objectives

Explain how Fannie Mae supports mortgage market liquidity by buying eligible loans from lenders instead of lending directly to homebuyers.
Calculate the maximum Fannie Mae financing concession for a conventional conforming loan by selecting the correct occupancy/LTV cap and applying it to the lower of the sales price or appraised value.
Identify how enterprise pricing matrices define "certain risk characteristics," start with credit score and LTV, and apply additional stackable adjustments.
Explain why a lender must resubmit an AUS file when a material fact changes after the initial findings.
Determine the correct underwriting classification for a two- to four-unit property based on whether the borrower will live in one unit, including the eligibility and fraud implications of occupancy errors.
Apply documentation standards to determine whether large deposits, gift funds, and deposited sale proceeds are acceptable down payment funds.
Differentiate replacement-cost settlement from actual-cash-value settlement when determining whether hazard insurance for a one- to four-unit conforming property is acceptable.

Lessons

Learning Objectives
Responsibilities of Fannie Mae
Limits on closing cost concessions
Fee charges on loans with certain risk characteristics
Fannie Mae and Freddie Mac automated underwriting systems
Requirements when purchasing a non-owner-occupied rental property
Acceptable down payment amounts
Hazard insurance requirements
Review Questions
Case Study

Module 24: Non-Traditional Mortgage Lending - Government loan programs

Time Allocation: 30 minutes

Learning Objectives

Define an FHA mortgage by identifying that the private lender originates and funds the loan while FHA insures it when program rules are met.
Differentiate the lender's funding role from FHA's insurance role in an FHA loan, including who is owed the note and why FHA should not be described as lending cash at closing.
Explain that a VA Certificate of Eligibility confirms benefit eligibility but does not commit the lender to make the loan, because the applicant must still satisfy VA and lender requirements for credit, income, occupancy, and property acceptability.
Compare how FHA and VA-backed loans treat mortgage insurance for the same purchase, including why a VA-backed loan generally does not include monthly PMI or MIP.
Calculate the upfront cost, monthly payment savings, and approximate break-even horizon when a borrower chooses 6.00 percent with one point instead of 6.25 percent with no point on a $200,000 FHA loan.
Differentiate the three main federal backers in this lesson by identifying that FHA insures eligible mortgages, VA guarantees part of a lender's loss subject to program limits, and USDA guarantees qualifying rural loans in an amount equal to 90 percent of the loan.
Define VA entitlement as a legal benefit that represents available home-loan guaranty for an eligible veteran, service member, or qualifying surviving spouse, rather than a cash grant paid to the borrower.
Identify whether a property satisfies FHA purchase eligibility by meeting the one- to four-family size limit and being an owner-occupied principal residence.
Determine whether a requested FHA-insured loan fits the applicable limit by comparing the insurable mortgage amount to the current HUD table for the correct county or metropolitan area and unit count.
Calculate the correct VA funding fee percentage in common purchase-loan scenarios by applying prior VA loan use and down payment category.
Explain how UFMIP may be paid or financed on FHA single-family loans, including that financed UFMIP is added to the insured mortgage amount, the standard 175 basis point rate, and the rule that the upfront MIP calculation is not rounded.
Explain what VA residual income measures after housing expense and recurring obligations are deducted and why VA uses it alongside debt-to-income ratio to assess repayment ability.
Calculate the monthly FHA mortgage insurance amount by dividing the annual premium by 12, rounding to the nearest cent, and including that amount in the qualifying housing payment.
Calculate the minimum FHA purchase down payment by using the borrower's Minimum Decision Credit Score range to determine whether 3.5% maximum financing or a 10% down payment applies.

Lessons

Learning Objectives
Definition of FHA mortgage
Facts about FHA loans
Facts about VA loans
Prohibition on mortgage insurance
FHA interest rate calculation scenarios
Types of government guarantors
Definition of entitlement
Properties eligible for FHA purchase transactions
FHA loan limits
VA funding fees
Upfront mortgage insurance premiums
Residual income qualification test
Monthly mortgage insurance payment scenarios
Minimum down payment for an FHA loan
Review Questions
Case Study

Module 25: Non-Traditional Mortgage Lending - Conventional and nonconforming loans

Time Allocation: 30 minutes

Learning Objectives

Differentiate jumbo loans from FHA and VA programs by identifying that jumbo refers only to a loan amount above conforming limits and can still be fully documented and conservatively underwritten.
Identify whether a mortgage is non-conforming by checking if it exceeds the FHFA county limit or falls outside current investor rules, and distinguish that classification from automatic illegality or high risk.
Explain why underwriting should evaluate a borrower's ability to repay at the higher payment rather than only at the introductory amount when payment shock is possible.
Differentiate subprime from nonconforming loans and payment shock by classifying whether a fact pattern turns on elevated default risk, agency purchase standards, or future payment increases.
Calculate the fully indexed rate of an ARM from the current index and contractual margin, distinguishing it from an introductory rate.
Calculate a borrower's debt-to-income ratio from total monthly debt obligations and qualifying monthly income to show how much income is committed before taxes and other living costs.
Explain how underwriters interpret credit risk characteristics by weighing the overall pattern of weaker features and recognizing when combined weaknesses justify closer review or stricter loan terms.
Explain how a creditor should evaluate a borrower's ability to repay a subprime mortgage by testing repayment at the fully indexed rate and on a fully amortizing schedule rather than relying only on the teaser payment.
Explain how the guidance requires a lender to evaluate repayment capacity for a nontraditional mortgage by qualifying the borrower at the fully indexed rate on a fully amortizing schedule and by accounting for negative amortization in a payment-option ARM rather than relying on an introductory payment.
Identify the payment features that make a mortgage non-traditional: an initial period of principal or interest deferral, possible negative amortization, and later recast to fully amortizing payments.
Explain how payment shock and negative amortization can make a non-traditional mortgage seem affordable at origination but create greater risk later.
Analyze whether an interest-only ARM with a simultaneous second lien is underwritten soundly by checking the later fully indexed, fully amortizing payment, the second-lien obligation, and mortgage-related expenses instead of relying on an expected refinance or sale before reset.
Compare the borrower-fit questions tied to an interest-only period, an adjustable rate, and a negative amortization option to identify which future payment risk must be evaluated for each non-traditional mortgage feature.

Lessons

Learning Objectives
Facts about jumbo loans
Definition of a non-conforming loan
Definition of payment shock
Definition of subprime
Characteristics of ARM loans
Definition of a debt-to-income ratio assessment
Examples of credit risk characteristics
Characteristics of a subprime mortgage
Guidance on Nontraditional Mortgage Product Risk
Characteristics of a non-traditional mortgage loan
Risks of non-traditional mortgage products
Repayment capacity of a borrower
Identifying the right non-traditional mortgage product for borrowers
Review Questions
Case Study

Module 26: Non-Traditional Mortgage Lending - Qualified and non-qualified mortgage programs

Time Allocation: 15 minutes

Learning Objectives

Identify whether a loan scenario fits the baseline general QM product limits by recognizing prohibited payment structures and the 30-year maximum term.
Identify the core underwriting information a creditor must consider when determining whether a mortgage qualifies under Regulation Z 1026.43(c)(2).
Identify the key conditions a loan must meet to become a seasoned qualified mortgage after origination.
Explain the legal effect of a non-QM designation by stating that it is mostly an industry label and that creditors still must satisfy the ability-to-repay standard for covered transactions.
Explain the defining compliance distinction between a covered non-QM loan and a qualified mortgage by identifying that non-QM loans still require ability-to-repay analysis but do not receive QM status and its presumptions.

Lessons

Learning Objectives
Features of a qualified mortgage
Information used to determine whether a loan is qualified
Categories of qualified mortgages
Non-qualified mortgage programs
Features of a non-qualified mortgage
Review Questions
Case Study

Module 27: Electives - Mortgage industry foundations, oversight, and core loan terms

Time Allocation: 50 minutes

Learning Objectives

Explain how post-crisis federal reforms defined and regulated mortgage loan originators to strengthen consumer protection through licensing accountability and ability-to-repay standards.
Differentiate mortgage transaction roles by identifying that the company collecting payments, the person who took the application, the person who approved the file, and the institution that owns the loan after closing may be different parties.
Explain the CFPB's statutory purpose by identifying that it is meant to make consumer finance markets fair, transparent, and competitive while protecting consumers from unfair, deceptive, or abusive acts and practices.
Compare the counseling obligations for a standard purchase application, a high-cost mortgage, and a covered negative amortization loan to a first-time borrower so the correct pre-closing requirement can be identified for each scenario.
Differentiate a higher-priced mortgage loan from a high-cost mortgage by identifying each category's trigger and relative level of restrictions described in the lesson.

Lessons

Learning Objectives
History of the mortgage industry
Positions in the mortgage industry and their roles
Consumer Financial Protection Bureau (CFPB)
Department of Housing and Urban Development (HUD)
Loan terms
Review Questions
Case Study

Module 28: Electives - Origination terminology and borrower inquiry basics

Time Allocation: 50 minutes

Learning Objectives

Differentiate the disclosure terms in this lesson by matching each term to the specific compliance question it answers in a mortgage file.
Differentiate discount points, lender credits, and premium pricing by identifying the immediate closing-cost effect and the longer-term loan-cost effect for each term.
Distinguish APR from APOR by identifying APR as the cost of a specific loan to a specific consumer and APOR as a broader market benchmark.
Identify when a borrower inquiry becomes an application for Loan Estimate purposes by recognizing the six required pieces of information and the effect of receiving them.
Identify the six pieces of information that cause a mortgage inquiry to meet the TRID application threshold.

Lessons

Learning Objectives
Disclosure terms
Financial terms
General terms
Loan requirements
Loan inquiry process
Review Questions
Case Study

Module 29: Electives - Application workflow, documentation, and disclosure fundamentals

Time Allocation: 50 minutes

Learning Objectives

Identify the six pieces of information that create an application for most closed-end mortgage disclosures and determine that missing additional fields do not delay application status.
Explain how verification is completed by reconciling major application facts with supporting records or documented exceptions before the file moves forward.
Determine the portion of a bank account balance that is attributable to a mortgage application using records that show ownership, contribution of funds, and the borrower's documented right to use the money.
Identify recurring problems that make product and program selection unsuitable at application, including choosing for a marketing rate instead of verified eligibility, treating occupancy or loan purpose as flexible, overlooking reserves or property type, and assuming automated approval proves suitability.
Identify when a creditor may impose most early fees, the one fee exception, and whether verification documents may be required before the Loan Estimate.
Determine whether a given closing-cost charge belongs in the 10% cumulative tolerance category by checking whether the service is required, shopping was permitted, the provider is unaffiliated, the consumer used the written list, and the covered charges stay within the aggregate 10% limit.
Differentiate the six-item TRID application trigger from the Regulation B completed-application trigger by identifying when the Loan Estimate may be due and when the action-taken clock begins.

Lessons

Learning Objectives
Application process
Verification and documentation
Percentage of bank account assets attributable toward a loan application
Suitability of products and programs
Disclosures
Accuracy and tolerances
Timing
Review Questions
Case Study

Module 30: Electives - Loan Estimate, Closing Disclosure, and initial asset review

Time Allocation: 50 minutes

Learning Objectives

Distinguish the third-business-day Loan Estimate issuance deadline from the seven-business-day waiting period by identifying what each rule controls after a six-item application.
Identify the required contents of a compliant written list of settlement service providers by recognizing that it must match the services shown under "Services You Can Shop For," identify at least one actually available provider for each listed service, state that the consumer may choose a different provider, and include enough contact information to reach the provider.
Identify the three categories of events that qualify as a changed circumstance for revised disclosures.
Compare TRID delivery methods to determine how each method changes the legal receipt date and the compliance timeline for required disclosures.
Identify the three pre-consummation changes that require the borrower to receive a corrected Closing Disclosure at least three business days before consummation.
Identify the required delivery timing and responsibility rules for the homeownership counseling disclosure in a covered application, including the three-business-day deadline, the withdrawal or denial exception, and the one-list rule when multiple lenders are involved.
Identify the ordered steps and purpose of a sound initial asset review so asset funds are evaluated for closing needs, documentation, restrictions, and reserve sufficiency.

Lessons

Learning Objectives
Loan Estimate
Sending a list of counseling services
Valid reasons for a change in circumstance
Delivery method
Closing Disclosure
Homeownership counseling disclosure
Assets
Review Questions
Case Study

Module 31: Electives - Qualification ratios, income, liabilities, and credit analysis

Time Allocation: 50 minutes

Learning Objectives

Differentiate liabilities from ordinary living expenses on a mortgage application by determining whether another party can generally enforce the payment obligation.
Differentiate qualifying income from mere receipt of funds by identifying the need for documentation, expected continuance, and the exclusion risk for one-time or speculative income.
Explain how a mortgage credit report supports mortgage qualification by distinguishing it from a credit score and describing how it provides context about current obligations and repayment patterns.
Explain how the debt-to-income ratio evaluates repayment capacity by comparing gross monthly income to total recurring monthly obligations, including housing expense and other counted debts.
Calculate the housing-to-income ratio in the lesson's worked example by converting annual income to gross monthly income, totaling the listed monthly housing charges, and converting the quotient to a percentage.
Calculate the total debt ratio from monthly housing expense, recurring monthly debt obligations, and gross monthly income, and express the result as a percentage.

Lessons

Learning Objectives
Liabilities
Income
Credit report
Qualifying ratios
Calculating the housing-to-income ratio
Calculating the total debt ratio
Review Questions
Case Study

Module 32: Electives - Ability to repay, occupancy, verification, appraisals, and title review

Time Allocation: 50 minutes

Learning Objectives

Identify the core ATR duty to base the underwriting decision on verified information available at or before consummation and on the borrower's present ability to make required payments rather than on property value.
Evaluate a refinance file for tangible net benefit by reviewing payment, rate structure, term, loan amount, costs, the borrower's reason for refinancing, and, when relevant, the practical period for recovering refinance costs.
Differentiate primary residence, second home, and investment property classifications by the borrower's intended occupancy at the time of origination.
Analyze a deposit scenario by identifying whether the account belongs to the borrower or another acceptable party, whether the money comes from an acceptable source, and whether the funds are traceable and still available at closing.
Identify the appraisal standards and early disclosure requirements for a covered higher-priced mortgage loan before consummation, including appraiser qualifications, interior inspection, notice timing, and required consumer disclosures.
Explain how a title report and a title commitment together identify recorded title matters, required pre-closing actions, and closing-date risk in a mortgage file.

Lessons

Learning Objectives
Ability to repay
Tangible net benefit
Occupancy types
Verification of deposit scenarios
Appraisals
Title report
Review Questions
Case Study

Module 33: Electives - Insurance protections and settlement mechanics

Time Allocation: 50 minutes

Learning Objectives

Explain how the federal minimum required flood insurance amount is determined by the lesser-of rule and why that legal minimum may still leave the borrower exposed to flood loss.
Explain the federal PMI removal framework for many covered conventional loans by identifying the 80 percent request threshold, the 78 percent automatic termination threshold, and the midpoint fallback termination rule.
Apply federal force-placed insurance notice, cost-disclosure, and proof-of-coverage rules to identify when a servicer may charge a borrower and when it must cancel and refund overlapping charges.
Differentiate the protections provided by a lender's title policy and an owner's title policy in a financed purchase by identifying which party and interest each policy insures.
Differentiate who must sign the security instrument and who must sign the note at closing based on ownership interest, required property-rights waivers, and whose credit was used to qualify.
Differentiate closing-statement fee categories by matching title fees, prepaids, and escrow deposits to the purpose each serves.
Explain how the promissory note and security instrument work together in a mortgage transaction by distinguishing the note's debt terms from the security instrument's connection of that debt to specific real estate.
Calculate the earliest funding point for a refinance signed on Thursday when the required notice and material disclosures are delivered that day and no federal holiday intervenes.

Lessons

Learning Objectives
Insurance
Private mortgage insurance
Hazard and homeowner insurance
Title and title insurance
Settlement and closing agent
Explanation of fees
Explanation of documents
Funding
Review Questions
Case Study

Module 34: Electives - Mortgage math fundamentals

Time Allocation: 50 minutes

Learning Objectives

Calculate one month of periodic interest for a mortgage by dividing the annual note rate by 12 and multiplying the monthly rate by the unpaid principal balance.
Calculate the projected monthly housing payment in the lesson's $250,000 example by converting the annual mortgage insurance factor and annual escrowed charges into monthly amounts and adding them to principal and interest.
Calculate the down payment in dollars and as a percentage of purchase price from a stated purchase price and loan amount, and distinguish that amount from other cash needed to close.
Calculate a loan-to-value ratio by dividing the mortgage amount being underwritten by the permitted property value and converting the result to a percentage.
Calculate a total debt-to-income ratio for a borrower scenario by dividing included required monthly debts by gross monthly income rather than total debt balances.

Lessons

Learning Objectives
Periodic interest
Payments
Down payments
Loan-to-value ratios
Debt-to-income ratios
Review Questions
Case Study

Module 35: Electives - Mortgage pricing, indexed-rate math, and fixed-rate payment analysis

Time Allocation: 50 minutes

Learning Objectives

Calculate discount-point charges from the loan amount and point percentage, including when the purchase price differs from the loan amount.
Differentiate closing costs from prepaid items by identifying that closing costs pay for making, documenting, and recording the loan, while prepaid items fund ownership or loan-servicing expenses that begin at or just after settlement.
Differentiate the uncapped fully indexed formula result from the actual adjusted note rate in an ARM adjustment by identifying the formula calculation, the cap test, and the final rate that may take effect.
Calculate the worked example's total monthly debt obligations and DTI by applying the $1,436 or $1,468 qualifying payment to the listed recurring debts and $7,200 gross monthly income.
Differentiate, in fixed-rate mortgage scenarios, between changes to the stable scheduled principal-and-interest payment and changes to the total monthly amount due caused by taxes, insurance premiums, mortgage insurance, or other collected items.

Lessons

Learning Objectives
Discount points and fixed interest rate buy-downs
Closing costs and prepaid items
Adjustable-rate mortgages and fully indexed rates
Qualified mortgage monthly payment calculations
Fixed-rate mortgages
Review Questions
Case Study

Module 36: Electives - Adjustable and specialty mortgage products

Time Allocation: 50 minutes

Learning Objectives

Calculate the fully indexed rate on an ARM by adding the current index value and the loan margin, and distinguish it from an introductory start rate.
Evaluate borrower exit strategies to determine whether a balloon mortgage may fit based on a credible, documented way to resolve the unpaid balance on or before maturity.
Identify at least three common events named in the lesson that can make a reverse mortgage due and payable in full.
Explain how to evaluate a purchase money second by measuring leverage with both liens together and by treating the subordinate financing as debt rather than as a gift, grant, or seller credit.
Identify the draw-repay-redraw feature that makes a HELOC different from a traditional second mortgage.

Lessons

Learning Objectives
Adjustable-rate mortgages
Balloon mortgage loan products
Reverse mortgages
Purchase money second mortgages
Home equity lines of credit (HELOCs)
Review Questions
Case Study

Module 37: Electives - Construction, interest-only, other products, and state regulatory framework

Time Allocation: 50 minutes

Learning Objectives

Differentiate same-creditor construction financing that should be treated as one combined construction-permanent transaction from financing that should be treated as separate extensions of credit by identifying the legal-structure facts that control the classification.
Explain how an interest-only mortgage's required payment affects principal during the interest-only period and why the required payment changes after that period ends.
Compare balloon loans, HELOCs, and reverse mortgages by identifying which one concentrates risk at maturity, which one spreads risk across borrowing and repayment phases, and which one delays repayment while increasing balance risk over time.
Explain why lawful authority to operate in a state depends on the state agency's decision rather than the existence of an NMLS record.
Differentiate state-licensed and registered loan originators by classifying the typical employment channel for each and identifying the NMLS item both categories receive.
Differentiate support tasks from licensed origination activity when processors or underwriters communicate with consumers about documents, loan choices, rates, or revised terms.

Lessons

Learning Objectives
Fundamentals of construction mortgages
Interest-only mortgages
Other mortgage products
State mortgage regulatory agencies
Definitions and documents
License law and regulation
Review Questions
Case Study

Module 38: Electives - State licensing, maintenance, NMLS, and compliance

Time Allocation: 50 minutes

Learning Objectives

Identify when support work becomes licensable MLO activity by recognizing loan-matching analysis, presenting terms for acceptance, or relaying revised pricing during negotiation.
Identify the SAFE MLO test passing score and retake waiting periods an applicant must satisfy under the federal rule.
Explain the main grounds on which an MLO license application may be denied, including mandatory legal bars and record-based concerns about future lawful conduct.
Identify the federal annual continuing education requirement for renewal, including the 8-hour minimum and the required subject-hour distribution.
Differentiate the source of authority for registered depository employees and state-licensed non-depository employees, and identify the additional status required when moving from a bank to an independent mortgage company.
Identify the documentation, disclosure, and response controls that a compliant originator or mortgage company uses so a transaction can withstand regulatory review.

Lessons

Learning Objectives
Business activities that may or may not be conducted without an MLO license
Licensee qualifications and application process
Grounds for denying a license
License maintenance
NMLS requirements
Compliance
Review Questions
Case Study

Module 39: Final Exam

Course Schedule

Course Date: Courses begin daily at 9:00 AM ET. Each course offering has a defined start and end date.

Course Schedule: This online instructor-led course is offered within a defined schedule that includes required instructional hours, timed content, and ongoing instructor-led interaction.

Daily Schedule

Day 1 (9:00 AM–5:00 PM ET): Ethics Modules 1–13; Federal Law Modules 14–22; Non-Traditional Mortgage Lending Modules 23–26
Day 2 (9:00 AM–5:00 PM ET): Electives Modules 27–34
Day 3 (9:00 AM–5:00 PM ET): Electives Modules 35–38 and Final Exam

Students are not able to complete more than 8-hours of study per day.

Students are required to complete all course elements in sequence and may not advance except as permitted by the course structure, including seat-time requirements, assessments, and required discussion participation.