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An MLO has been continuously licensed in State X for 7 years. She is moving to State Y and applies for an MLO license there. State Y has both a National Test Component and a state-specific test component. She passed the National Test 7 years ago. Which of the following correctly describes her testing obligations in State Y?

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Correct answer: She must pass only the State Y-specific test component; her National Test score is valid due to continuous licensure

Under NMLS rules, an MLO who has maintained a continuously active state license does not need to retake the National Test Component, regardless of how long ago she originally passed it — continuous licensure preserves the validity of the passing score. However, the National Test portability only covers the National Component. If State Y requires a state-specific test component, she must pass that component because each state's specific content is unique to that jurisdiction. "She must retake both the National Test and the State..." is incorrect: continuous licensure means the 5-year retesting threshold does not apply. "She must retake only the National Test; state-specif..." overstates the exemption — she still must pass any state-specific component required by State Y. "She is exempt from all testing because she has been..." is backwards — the National Test is exempt from retesting, not the state-specific component.

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