New HUD Retake Policy for SAFE MLO Testing to Take Effect August 29

The U.S. Department of Housing and Urban Development (HUD) has published a new rule that may make the SAFE MLO testing process a little more difficult for some loan officer applicants, as it limits the number of times a candidate may fail a component of the test before needing to sit out for a 180-day wait period.

HUD published its final rule to this effect at the end of June regarding changed SAFE Act procedure, announced the Nationwide Mortgage Licensing System and Registry. Previously, candidates taking the test had to wait 180 days to retake the test after failing a component four times; the new rule says candidates must wait for six months if they fail a component three times.

The rule goes into effect on August 29, but candidates who are enrolled to take the test prior to this date are still governed by the old rule. Candidates who have already failed a component of the test two or more times should “assess their testing plans between now and August 28,” NMLSR encouraged, while the old rule is still effective.

If applicants have opened their fourth enrollment windows anytime before August 28, they’ll be allowed to schedule their fourth test-taking any time after the 30-day wait period, even if it goes beyond when the new rule goes into effect.

View NMLSR’s information on the policy change here.

Written by Alyssa Gerace

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