MLO Study Guide (Free, Based on the Official Outline)

Updated October 20, 2026

Study in this order: (1) complete the required 20-hour NMLS-approved course, (2) learn federal law timelines and thresholds, (3) learn the SAFE Act and Uniform State Content, (4) master loan programs and origination math, (5) review ethics and fraud scenarios, then (6) take timed full-length practice exams until you score well above 75%.

Required education first

The SAFE Act requires at least 20 hours of NMLS-approved pre-licensing education. That includes at least 3 hours of federal law, 3 hours of ethics (covering fraud, consumer protection, and fair lending), and 2 hours on lending standards for nontraditional mortgage products (12 U.S.C. §5104(c)). Licensed MLOs then take 8 hours of continuing education each year (12 U.S.C. §5105(b)). This site is practice. It doesn't replace those courses.

Topic checklist by outline area

Federal mortgage-related laws (24%)

RESPA/Reg X (Section 8 kickbacks, escrow, servicing, loss mitigation); TILA/Reg Z (APR, finance charge, rescission, advertising, LO compensation, ability-to-repay/QM, HOEPA, HPML); TRID Loan Estimate and Closing Disclosure timing and tolerances; ECOA/Reg B; FCRA/FACTA; HMDA/Reg C; GLBA privacy and Safeguards; BSA/AML and SARs; Do-Not-Call/TSR; E-Sign; HPA (PMI cancellation)

Uniform State Content (11%)

SAFE Act definitions; who must be licensed; NMLS unique identifier; education, testing, and retake rules; license renewal and CE; temporary authority; state regulator authority; prohibited conduct

General mortgage knowledge (20%)

Conventional and conforming loans; FHA, VA, USDA; ARMs (index, margin, caps); reverse mortgages/HECM; QM vs. non-QM; assumptions; points, buydowns, and lender credits; mortgage insurance

Origination activities (27%)

Application (URLA) and required disclosures; verifying income, assets, and gifts; DTI and LTV; appraisals and valuation independence; title, flood, and hazard insurance; closing and funding; mortgage math

Ethics (18%)

Fair lending and fair housing; fraud red flags (occupancy, straw buyers, undisclosed debt); UDAAP; truthful advertising; referral fees; consumer data security

A 3-week plan (after your course)

WeekFocus
1Federal law and TRID timelines. 30 practice questions a day; review every explanation.
2SAFE Act, loan programs, and mortgage math. One timed 60-question quiz every other day.
3Ethics, then two full timed 120-question exams. Re-drill missed topics.

This plan is a suggestion, not an NMLS recommendation.

Check yourself

1. Under the Homeowners Protection Act, borrower-paid PMI must automatically terminate when the loan is scheduled to reach what LTV (based on original value), if current?
  1. 80%
  2. 78%
  3. 75%
  4. 70%
Show answer and explanation

Answer: B. 78%
Correct — automatic termination at 78%.

Source: 12 U.S.C. 4902(b)

2. Which law requires financial institutions to give customers a privacy notice about sharing nonpublic personal information?
  1. Gramm-Leach-Bliley Act
  2. Fair Housing Act
  3. HOEPA
  4. Bank Secrecy Act
Show answer and explanation

Answer: A. Gramm-Leach-Bliley Act
Correct — GLBA's Privacy Rule requires privacy notices and opt-out rights.

Source: 12 CFR 1016.4(a)

3. For an FHA-insured HECM reverse mortgage, the youngest borrower must be at least:
  1. 55
  2. 59½
  3. 62
  4. 65
Show answer and explanation

Answer: C. 62
Correct — 62.

Source: 24 CFR 206.33

4. Which loan program is designed for eligible rural areas and has household income limits?
  1. VA
  2. USDA
  3. FHA 203(k)
  4. Jumbo
Show answer and explanation

Answer: B. USDA
Correct — USDA Rural Development guaranteed loans.

Source: 7 CFR 3555.10 (definitions: moderate income)

5. A borrower says they'll live in the home but plans to rent it out immediately to get a better rate. This is:
  1. Acceptable if the rate is fixed
  2. Occupancy fraud
  3. A permitted strategy for investors
  4. A RESPA violation by the borrower
Show answer and explanation

Answer: B. Occupancy fraud
Correct — misrepresenting occupancy is mortgage fraud.

Source: 18 U.S.C. 1014

6. Under Reg Z, an ad stating 'Only $500 down!' must also disclose:
  1. Nothing further
  2. The down payment, terms of repayment, and APR
  3. The lender's net worth
  4. The LO's home address
Show answer and explanation

Answer: B. The down payment, terms of repayment, and APR
Correct — the down payment amount is a trigger term (§1026.24(d)(1)). The ad must also state the down payment, the terms of repayment (including any balloon), and the APR, plus the fact that the rate may increase if it can (§1026.24(d)(2)).

Source: 12 CFR 1026.24(d)(1)-(2)

Practice with every question

392 questions, each with an explanation for every option and an official source, plus a timed 120-question, 190-minute practice exam.

Try 25 free in the appSee launch price

Official sources

FAQ

How many hours of pre-licensing education do I need?

At least 20 hours of NMLS-approved education, including 3 hours of federal law, 3 hours of ethics, and 2 hours on nontraditional mortgage lending (12 U.S.C. §5104(c)). Some states require more.

Is this an NMLS-approved course?

No. It's a free study guide and practice tool. It doesn't count toward education hours.

How much continuing education is required?

8 hours a year for state-licensed MLOs (12 U.S.C. §5105(b)).

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