What's on the NMLS Exam? Don't be surprised!

What are the topics tested on the NMLS exam?

Here's a breakdown of the topics covered in the NMLS exam

• Federal Mortgage-Related Laws (23%)
• Truth in Lending Act (TILA)
• Real Estate Settlement Procedures Act (RESPA)
• Equal Credit Opportunity Act (ECOA)
• SAFE Mortgage Licensing Act
• Fair Credit Reporting Act (FCRA)
• Gramm-Leach-Bliley Act (GLBA)
• Other federal regulations relating to consumer protection, fair lending, and anti-money laundering.

• General Mortgage Knowledge (23%)
• Basics of mortgage lending concepts
• Conventional, FHA, VA, and USDA loan programs
• Loan terms and amortization
• Underwriting guidelines
• Loan to Value (LTV), Debt to Income (DTI) ratios

• Mortgage Loan Origination Activities (25%)
• Taking and processing applications
• Disclosures and documentation requirements
• Pre-qualification and pre-approval of borrowers
• Working with realtors, appraisers, and title companies
• The closing process

• Ethics (16%)
• Fraud, misrepresentation, and predatory lending practices
• Fair and responsible advertising
• Consumer privacy and data protection

• Uniform State Content (13%)
• Specific state licensing laws and regulations
• State-specific definitions and concepts

What are the type of questions show up on NMLS Exam?

The NMLS exam features mixed type of multiple-choice questions. Here's what you can expect:

Types of Questions:

• Knowledge-based: These test your understanding of basic mortgage concepts, terminology, and calculations.
• Example: "What is the primary purpose of an appraisal?"

• Regulation-specific: A large portion of the exam focuses on federal mortgage-related laws and regulations. You'll need to know how they apply to different situations.
• Example: "A loan originator provides a Loan Estimate to an applicant three days after receiving a complete application. Which regulation has been violated?"

• Situational/Scenario-based: These present realistic scenarios and ask you to make decisions based on regulations, ethics, or best practices.
• Example: "A borrower's debt-to-income ratio exceeds the lender's guidelines. The loan originator suggests the borrower omit a recurring debt from the application. What is the appropriate action for the loan originator to take?"

• Math-based: There will be some calculations, mainly focusing on:
• Loan-to-value (LTV)
• Debt-to-income (DTI)
• Interest rates and payments

What are the best practices to pass NMLS exam stress free

Here's a guide to the best practices for a stress-free NMLS exam experience:

Preparation Phase

Choose Quality Study Materials: Don't just rely on free resources. Invest in a comprehensive NMLS test prep course that includes:

• Up-to-date study guides covering all tested topics
• Practice exams with realistic questions

Create a Study Plan: Plan dedicated study time, spreading your learning over several weeks or months. This prevents cramming and reduces stress.

Focus on Understanding, Not Memorization: Focus on the "why" behind the rules and regulations. This helps you apply knowledge to different scenarios on the exam.

Take Advantage of Practice Exams: Take them frequently to gauge your progress, identify weaknesses, and get comfortable with the test format. Analyze incorrect answers to target those areas.

Join a Study Group (Optional): Collaborate with fellow test-takers for support, shared knowledge, and practice question discussions.

Mindset Matters

Confidence is Key: Believe in your abilities! A positive attitude goes a long way. Visualize yourself passing the exam.

Manage Test Anxiety: Practice relaxation techniques to remain calm during preparation and the exam. Try relaxation technique of concentration or Bandhu Kriya (Bharvi Consulting has expertise in improving learnability)

Don't Rush: Read questions carefully and thoroughly. Avoid making careless errors due to stress.

Exam Day

Rest Well: Get a good night's sleep before the exam. A tired mind won't be as sharp.

Eat a Healthy Breakfast: Fuel your brain for optimal focus.

Arrive Early: Avoid rushing and give yourself time to settle in at the testing center.

Trust Your Preparation: You've put in the work, now trust your knowledge!

Additional Tips

Understand Question Types: The NMLS exam uses multiple-choice questions with scenarios, so learn to analyze and apply information.

Eliminate Incorrect Answers: Narrow down choices by focusing on what is clearly wrong.

Time Management: Practice with timed exams, so you manage your pace effectively on the actual test.