In this paper we present an approach for real-time simulation and Hardware-in-the-Loop (HIL) testing of Modular Multilevel Converters (MMCs) that rely on switching models while supporting system level analysis. Using the Latency Based Linear Multistep Compound (LB-LMC) approach, we achieved a 50 ns simulation time step for systems composed of several MMC converters and for converters of various complexity. To facilitate system level testing, we introduce the use of a serial communication-based (Aurora) interface for HIL testing of MMC converters and we analyzed the effect that communication latency has on the accuracy of the HIL test. The simulation and HIL results are validated against an MMC laboratory prototype.