§ 1008.105 Minimum loan originator license requirements. For an individual to be eligible for a loan originator license required under § 1008.103(a) and (d), a state must require and find, at a minimum, that an individual: ( a ) Has never had a loan originator license revoked in any governmental jurisdiction, except that a formally vacated revocation shall not be deemed a revocation;
( b ) ( 1 ) Has never been convicted of, or pled guilty or *nolo contendere* to, a felony in a domestic, foreign, or military court: ( i ) During the 7-year period preceding the date of the application for licensing; or
( ii ) At any time preceding such date of application, if such felony involved an act of fraud, dishonesty, a breach of trust, or money laundering.
( 2 ) For purposes of this paragraph (b): ( i ) Expunged convictions and pardoned convictions do not, in themselves, affect the eligibility of the individual; and
( ii ) Whether a particular crime is classified as a felony is determined by the law of the jurisdiction in which an individual is convicted.
( c ) Has demonstrated financial responsibility, character, and general fitness, such as to command the confidence of the community and to warrant a determination that the loan originator will operate honestly, fairly, and efficiently, under reasonable standards established by the individual state.
( d ) Completed at least 20 hours of pre-licensing education that has been reviewed and approved by the Nationwide Mortgage Licensing System and Registry. The pre-licensing education completed by the individual must include at least: ( 1 ) 3 hours of Federal law and regulations;
( 2 ) 3 hours of ethics, which must include instruction on fraud, consumer protection, and fair lending issues; and
( 3 ) 2 hours of training on lending standards for the nontraditional mortgage product marketplace.
( e ) ( 1 ) Achieved a test score of not less than 75 percent correct answers on a written test developed by the NMLSR in accordance with 12 U.S.C. 5105(d).
( 2 ) To satisfy the requirement under paragraph (e)(1) of this section, an individual may take a test three consecutive times, with each retest occurring at least 30 days after the preceding test. If an individual fails three consecutive tests, the individual must wait at least 6 months before taking the test again.
( 3 ) If a formerly state-licensed loan originator fails to maintain a valid license for 5 years or longer, not taking into account any time during which such individual is a registered loan originator, the individual must retake the test and achieve a test score of not less than 75 percent correct answers.
( f ) Be covered by either a net worth or surety bond requirement, or pays into a state fund, as required by the state loan originator supervisory authority.
( g ) Has submitted to the NMLSR fingerprints for submission to the Federal Bureau of Investigation and to any government agency for a state and national criminal history background check; and
( h ) Has submitted to the NMLSR personal history and experience, which must include authorization for the NMLSR to obtain: ( 1 ) Information related to any administrative, civil, or criminal findings by any governmental jurisdiction; and
( 2 ) An independent credit report.