Effective Date of Rule: April 1, 2013.

     Purpose: To increase the number of required prelicensing education hours specific to Washington law. On April 1, 2013, a uniform state test section will be added to the National SAFE test. The Washington specific component test will be phased out. An increase in the number of Washington specific prelicensing education hours will ensure mortgage loan originator applicants have knowledge of Washington law prior to licensing.

     The rule making was proposed under OFM Guideline 3.d.

     Citation of Existing Rules Affected by this Order: Amending WAC 208-620-720 and 208-620-725.

     Statutory Authority for Adoption: Chapter 43.320 RCW; RCW 31.04.165.

      Adopted under notice filed as WSR 13-01-085 on December 18, 2013 [2012].

     Changes Other than Editing from Proposed to Adopted Version: WAC 208-620-720(2):

     Insert the words "SAFE required" in front of the words "prelicensing education" in two places to clarify that applicants who complete the SAFE required prelicensing education hours in any state will be deemed compliant for only those requirements in Washington; the applicants will still have to comply with the requirement for Washington specific prelicensing education hours.

     Change the words "nationwide mortgage licensing system and registry" to "NMLS" for consistency with references to the licensing system as provided for in the definitions.

     Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 2, Repealed 0.

     Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 2, Repealed 0;      Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 0, Repealed 0.

     Date Adopted: February 25, 2013.

Deborah Bortner, Director

Division of Consumer Services

OTS-5201.2

AMENDATORY SECTION(Amending WSR 09-24-090, filed 12/1/09, effective 1/1/10)

WAC 208-620-720   Loan originator -- Prelicensing education.   Must I complete prelicensing education in order to receive a loan originator license? Yes.

     (1) You must complete at least ((twenty)) twenty-two hours of prelicensing education approved by the NMLSR. The prelicensing education must include:

     (a) Three hours of federal law and regulations;

     (b) Three hours of ethics, which includes instruction on fraud, consumer protection, and fair lending issues;

     (c) Two hours of training related to lending standards for the nontraditional mortgage product marketplace; and

     (d) At least ((two)) four hours of training specifically related to Washington law.

     (2) You will receive credit for having completed the SAFE required prelicensing education for every state once you have successfully completed the SAFE required prelicensing education requirements approved by the ((nationwide mortgage licensing system and registry)) NMLS for any state.

     (3) Must I take continuing education in the year I complete the prelicensing education? No. You will not have a continuing education requirement in the year in which you complete the core twenty hours of prelicensing education.

[Statutory Authority: RCW 43.320.040, 31.04.165, 2009 c 120, and 2009 c 149. 09-24-090, § 208-620-720, filed 12/1/09, effective 1/1/10.]

     (1) You must take and pass the NMLS sponsored loan originator test. The test has two parts; one on federal law and regulation((,)) and one on ((Washington specific)) uniform state law and regulation. You must receive a score of seventy-five percent or higher to pass the test.

     (2) Where may I find information about the loan originator test? The NMLS web site will publish the names and contact information of approved testing providers.

     (3) How much does the loan originator test cost? Testing costs are set by the test provider and the NMLS and may be modified from time to time. The NMLS web site will publish the current testing fee with the testing provider contact information.

     (4) How do I register to take the loan originator test? Register through the NMLS web site.

     (5) What topics may be covered in the loan originator test? At a minimum, the test topics will include ethics, federal and state law and regulation pertaining to mortgage origination, federal and state law and regulation on fraud, consumer protection, nontraditional mortgage products, and fair lending.

     (6) After passing the loan originator test, will I have to take it again? If you fail to maintain a valid license for a period of five years or longer you must retake the test, not taking into account any time during which you were a registered mortgage loan originator.

     (7) How soon after failing the loan originator test may I take it again? After taking and failing the test you must wait thirty days before taking it again. After failing three consecutive times, you must then wait at least six months before taking the test again.

[Statutory Authority: RCW 43.320.040 and 31.04.165. 12-18-047, § 208-620-725, filed 8/29/12, effective 11/1/12. Statutory Authority: RCW 43.320.040, 31.04.165 and 2010 c 35. 10-20-122, § 208-620-725, filed 10/5/10, effective 11/5/10. Statutory Authority: RCW 43.320.040, 31.04.165, 2009 c 120, and 2009 c 149. 09-24-090, § 208-620-725, filed 12/1/09, effective 1/1/10.]