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 California Department of Real Estate Transition Plan 

Note: These instructions apply only to currently licensed real estate salespersons, brokers, or licensed corporation broker/officers who intend to perform mortgage loan activities on or after January 1, 2011. If you apply for and are issued a MLO (Mortgage Loan Originator) license endorsement by following these instructions, you will still be required to maintain your real estate license under existing California requirements in addition to the requirements/procedures listed below.

Real Estate Licensees who act as Mortgage Loan Originators:

All existing California real estate salesperson, broker, and corporation broker/officer licensees  who perform mortgage loan activities under Section 10131(d) and (e) or Section 10131.1(b)(1)(c) of the California Business and Professions Code  have until January 1, 2011  to meet the requirements to be issued a MLO endorsement.

Licensed corporations which perform mortgage activities must also be issued a separate MLO endorsement by January 1, 2011.

To allow DRE time to review all requests, the deadline for submitting your request through NMLS is September 15, 2010

Real Estate Brokers and Real Estate Corporations:

Licensed Real Estate Brokers must complete a Form MU 1, as a sole proprietor, Form MU 2, and Form MU4 and file through the NMLS by September 15, 2010. Please note, broker-associates who intend to perform MLO activities in the employ of another broker or corporation under a broker-salesperson agreement must be separately authorized to conduct those activities through the NMLS by filing Form MU4.  After the MU4 is submitted, the broker will need to create a company relationship and request a sponsorship from the employing broker or corporation.

Licensed Real Estate Corporations must also file Form MU1 through NMLS by September 15, 2010 to be issued a MLO endorsement. The designated broker/officer who intends to perform MLO activities must electronically submit Forms MU1 (on behalf of the corporation) and MU4 (as an INDIVIDUAL) through NMLS.  The designated broker/officer must list on the MU1 filing, each additional licensed officer and any control person(s) (MU2 filings) for the corporation. Control persons who are not licensed with DRE need only establish an individual account with NMLS, but do not need to create an MU4 filing. Each additional licensed broker/officer must complete and file an MU4 (as an individual).

All licensed broker officers of a corporation who intend to perform MLO activities on behalf of the corporation, will need to create a company relationship and request a sponsorship from the corporation

Branch Offices:

Brokers or corporations who intend to perform MLO licensed activities from a currently licensed branch office must file a Form MU3 for each location through NMLS by September 15, 2010 in order for the request to be approved by January 1, 2011.  A separate Branch Office license endorsement will not be issued by DRE.

Real Estate Salespersons:

In order to perform MLO licensed activities, CA-DRE Licensed Salespersons must complete Form MU4 through NMLS by September 15, 2010 in order to have an endorsement issued by January 1, 2011.  A licensed salesperson who performs MLO activities, needs to be properly affiliated with a licensed broker on DRE records, and separately authorized to perform those activities through the NMLS by filing Form MU4. After the MU4 is filed, your employing broker or corporation will need create a company relationship and you must request a sponsorship before the individual MU4 endorsement license will be approved by DRE.

Be advised that the Company MU1, (for brokers operating as sole proprietors or for licensed corporations) the Branch Location MU3 (when the Loan originator works from a branch) and the Loan Originator MU4 must all be submitted prior to the company sponsoring the loan originators license.

Loan originators can complete and submit Form MU4 themselves or their company (broker or corporation) can complete Form MU4 and have the loan originator log in to the NMLS and electronically attest to its accuracy.

Important Information

In order to qualify for a MLO license endorsement, existing licensees will first need to achieve a passing score on both the National and State component of the SAFE Mortgage Test. Licensees should review the Professional Requirements on the NMLS Resource Center website to get the details on this process. Since each component of the test must be scheduled and successfully completed, licensees are encouraged to begin the process as soon as possible in order to complete all requirements prior to January 1, 2011. In order to register for an examination, you must create an account on the Nationwide Mortgage Licensing System and obtain a NMLS unique identifier.

After successful completion of both test components, licensees may complete the CA MLO license endorsement application process. Be advised that the application process will require that you submit a new set of fingerprints. In addition, applicants will be required to provide authorization to obtain their credit report. (NOTE: Credit Report functionality will become available in NMLS on November 1, 2010.)

The SAFE Act requires completion of 20 hours of pre-license education in specific topics. DRE may be able to certify that you have met this requirement based on the pre-license and continuing education you have completed to obtain/maintain your real estate license.  Licensees must file Form MU4 and submit payment by December 1, 2010, to apply for this certification process. Please note that a separate $15.00 NMLS certification fee will be assessed as part of this process. An email request from the NMLS system will be sent to request payment of the certification fee. This fee invoice must be paid by December 31, 2010, in order for the certification to be granted.  Consult the DRE website at www.dre.ca.gov/lic_safe for further information on this topic.

General Information

It is important that current licensees have all of their California license numbers and other DRE license record information available when completing and submitting their Form MU1, Form MU3, and Form MU4(s). This information can be obtained at www2.dre.ca.gov/PublicASP/pplinfo.asp.

We encourage you to update your information with our office prior to submitting the above forms and verify that the requested changes have been processed on the DRE web site so at the time of transition there will be no pending changes to submit. 

NOTE: If you have submitted MU Forms in another state through NMLS you will not be required to complete the forms again, you must simply request the MLO license endorsement through NMLS.  (You must have obtained a real estate license in California before completing any of this process).


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