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WA Mortgage Loan Originator (MLO) Requirements

Mortgage Loan Originator (MLO) Requirements To Conduct Business In Washington

Current requirements
The following MLOs must have an active Loan Originator License:

• All MLOs working for a Mortgage Broker Practices Act (MBPA) licensee (including employees and independent contractors)
• Independent contractor MLOs working for a Consumer Loan Act (CLA) licensee

Future requirements
Effective July 1, 2010, all MLOs (independent contractors and employees of either MBPA or CLA licensees) must have an active Loan Originator license

• The Department will begin licensing MLO employees of CLA licensees on January 1, 2010

New SC Lender/Servicer License replaces SC Supervised Lender Lic effective January 1, 2010

There is a new SC Lender/Servicer License that replaces the SC Supervised Lender and covers all mortgage lending - both 1st and 2nd mortgages - effective 1/1/2010 - As Commissioner Bratton states below:  "If you hold a Supervised Lender License, this license will not allow you to make, service or originate any type of mortgage loan effective January 1, 2010."

 

 

August 14, 2009

All Mortgage Lenders / Servicers / Mortgage Loan Originators

ATTENTION: LICENSING DEPARTMENT

Dear Lender:

As you have probably heard, legislation (Bill S-673) was passed June 3, 2009 requiring the licensing for all types of (first and subordinate lien) mortgage lending. The legislation requires any employee that discusses mortgage loan applications, terms, or conditions with consumers be licensed and meet certain pre-licensing education and testing requirements pursuant to SAFE Legislation.

South Carolina passed this legislation for compliance with the Federal SAFE Act requirements regarding the licensing of all mortgage loan originators. This is the first time there has been a licensing requirement for first mortgage lending in South Carolina. There are requirements for companies to have surety bonds payable to the Commissioners, Office, Consumer Finance Division, SC Board of Financial Institutions in order to obtain licensing. You may view this legislation at

www.sc.gov and click on legislation and type in bill number S-673.

If you hold a Supervised Lender License, this license will not allow you to make, service or originate any type of mortgage loan effective January 1, 2010. Application through the National Mortgage Licensing System and Registry (NMLS) is required effective January 1, 2010, to obtain a license to act as a mortgage lender, servicer, or mortgage loan originator in South Carolina.

The attached information should prove helpful in pursuing the proper license for mortgage lending activity in South Carolina. Please review this information carefully and contact our office should you have any questions.

Sincerely,

C. Dean Bratton

Commissioner

Enclosures

CO Mortgage Loan Originator Checklist for New Applicants On or After January 1, 2010

CO Department of Regulatory Agencies, Division of Real Estate:

CO Mortgage Loan Originator Checklist for New Applicants On or After January 1, 2010

In July of 2008, Congress passed the Housing and Economic Recovery Act of 2008.  Title V of this Act is the S.A.F.E. Mortgage Licensing Act.  The S.A.F.E. Act establishes minimum licensing standards for mortgage loan originators and requires states to adopt such provisions.  As a result, the Colorado General Assembly passed House Bill 09-1085.  Accordingly, all mortgage loan originators under the supervision of the Director of the Division of Real Estate are required to be licensed as state-licensed loan originators.  Effectively, loan originators are required to be licensed by the Director of the Division of Real Estate and registered through the Nationwide Mortgage Licensing System and Registry.  The Director of the Division of Real Estate has created the following checklist to assist applicants on or after January 1, 2010.

__________    Submit a set of fingerprints for a criminal history record check to the Colorado Bureau of Investigations.  Detailed instructions on this process may be found at  http://www.dora.state.co.us/real-estate/applications/mortgagebroker/CBINotice.pdf.

__________    Obtain a compliant surety bond.  Surety bond requirements are defined in section 12-61-907, C.R.S. and by Director rule found at http://www.dora.state.co.us/real-estate/rulemaking/index.htm#MB.

__________    Obtain compliant errors and omissions insurance.  Errors and omission insurance requirements are defined in section 12-61-903.5, C.R.S. and by Director rule found at http://www.dora.state.co.us/real-estate/rulemaking/index.htm#MB.

__________    Complete the Colorado Division of Real Estate specific license application found at https://eservices.psiexams.com/index_login.jsp and pay the application fee prescribed by the Director.

__________    Submit fingerprints to the Nationwide Mortgage Licensing System and Registry in accordance with policies and procedures established by the Nationwide Mortgage Licensing System and Registry.

__________    Create an account with the NMLS&R in accordance with policies and procedures established by the NMLS&R.

__________    Complete the 20 hours of pre-licensing education reviewed and approved by the Nationwide Mortgage Licensing System and Registry or by a company contracted by the Nationwide Mortgage Licensing System and Registry for the review and approval of pre-licensing courses.

__________    Pass the two part S.A.F.E. Mortgage Loan Originator exam in accordance with policies and procedures established by the Nationwide Mortgage Licensing System and Registry.

__________    Register with the Nationwide Mortgage Licensing System and Registry in accordance with policies and procedures established by the Nationwide Mortgage Licensing System and Registry.  This includes, but is not limited to completion of the correct registration application, authorization for the registry to pull a credit report and payment of any fees associated with registration.

Important Information:

****The Director of the Division of Real Estate has 60 days to review all license or registration applications.  Accordingly, the Director recommends completing the registration process as soon as is possible. ****

**** Please note that criminal background checks from the Colorado Bureau of Investigations may take 1-2 months. ****

****All mortgage loan originators under the jurisdiction of the Director of the Colorado Division of Real Estate must be licensed as state-licensed loan originators by July 31, 2010. ****

For information concerning policies and procedures established by the Nationwide Mortgage Licensing System and Registry, please visit their website at http://www.stateregulatoryregistry.org/NMLS/AM/Template.cfm?Section=Home3.

CO LOAN PROCESSORS AND UNDERWRITERS-INDEPENDENT CONTRACTORS

DEPARTMENT OF REGULATORY AGENCIES

DIVISION OF REAL ESTATE

POSITION STATEMENT

MB 1.6 – INDEPENDENT CONTRACTOR LOAN PROCESSORS AND UNDERWRITERS

Section 1. Scope and Purpose

Section 2. Applicability

Section 3. Position Statement

Section 4. Issuance Date

Section 1. Scope and Purpose

In July of 2008, the Housing and Economic Recovery Act of 2008 was signed into law. Title V of the Economic

Recovery Act of 2008 is the S.A.F.E. Mortgage Licensing Act. The S.A.F.E. Mortgage Licensing Act defines

minimum national licensing standards for mortgage loan originators and requires states to adopt such provisions.

The S.A.F.E. Mortgage Licensing Act requires all independent contractor processors or underwriters to be licensed

as state-licensed loan originators. Accordingly, the Colorado General Assembly passed House Bill 09-1085 in May

of 2009. This bill was signed into law by Governor Bill Ritter Jr. on May 21, 2009. House Bill 09-1085 becomes

effective August 5, 2009. The Director of the Division of Real Estate has received many inquiries from loan

processors and underwriters regarding when they need to be licensed as state-licensed loan originators. House Bill

1085 does define a requirement for licensure, but does not specify a timeline. The purpose of this position statement

is to clearly provide a timeline for independent contractor processors and underwriters regarding when they are

required to be licensed as state-licensed loan originators.

Section 2. Applicability

This position statement concerns all independent contractor loan processors and underwriters as these terms are

defined in section 12-61-902(4.9), C.R.S.

Section 3. Position Statement – MB 1.6 – Independent Contractor Loan Processors and Underwriters

The Director’s position on this matter is that all independent contractor loan processors and underwriters shall be

licensed as state-licensed loan originators by July 31, 2010. On and after August 1, 2010, independent contractor

loan processors or underwriters shall not engage in residential mortgage loan origination activities as a loan

processor or underwriter unless they are licensed as a state-licensed loan originator.

Section 4. Issuance Date

The Director of the Division of Real Estate issues this position statement July 22, 2009.

OH SAFE ACT

On July 30, 2008, the Housing and Economic Recovery Act of 2008 (”HERA”) was signed into law. Title V of HERA is the Secure and Fair Enforcement for Mortgage Licensing Act ("SAFE Act").

The SAFE Act required that each state pass enabling legislation no later than July 31, 2009 to bring current state licensing law into compliance with the new SAFE Act requirements. Ohio’s enabling legislation passed the 128th General Assembly as part of House Bill 1 and was signed into law by Governor Strickland on July 17, 2009.

Ohio’s SAFE Act enabling legislation makes the necessary changes to both the Ohio Mortgage Broker Act (“OMBA”) and the Ohio Mortgage Loan Act (“OMLA”) to bring Ohio into compliance.

The Department of Commerce Division of Financial Institutions (“DFI”) is charged with overseeing the implementation of the new SAFE Act legislation including Ohio’s transition to the Nationwide Mortgage Licensing System and Registry (“NMLS”). Ohio will begin using NMLS on January 4, 2010. This webpage is designed to provide the industry with continuous updates and a single source of information to assist in this transition.

• Ohio DFI Specific Transition Announcements and Information
• Key Implementation Dates (PDF) http://www.com.state.oh.us/fiin/docs/SAFEKeyDates.pdf
• Summary of House Bill 1 (PDF) http://www.com.state.oh.us/fiin/docs/SAFEHB1.pdf
• Ohio Resources
• Enabling Legislation - House Bill 1 effective January 1, 2010 (page 532 – 627)  http://www.com.state.oh.us/fiin/docs/SAFEHB1.pdf

Timing for Compliance with the SAFE Act/Effective Date:

Ohio’s SAFE Act takes effect on January 1, 2010.  Current OMBA registrants and licensees must be SAFE compliant at the time of their next renewal in April 2010. Entities seeking an OMBA approved exemption and previously exempt loan originators in their employ must be in compliance by April 30, 2010.  Current OMLA registrants must be SAFE compliant at the time of their next renewal in June 2010. To allow sufficient processing time for the anticipated volume of new mortgage loan originator license applications, OMLA mortgage loan originators will be able to operate via a safe harbor until December 31, 2010.3

The New Jersey Residential Mortgage Lending Act (“RMLA”)

In response to new federal requirements established in the Secure and Fair Enforcement for

Mortgage Licensing Act of 2008, 12 U.S.C. s. 5101, et seq., residential mortgage activity is now

governed by The New Jersey Residential Mortgage Lending Act, P.L. 2009, c. 53, (“RMLA”) The

RMLA establishes licensing standards, business practices and oversight for residential mortgage

lenders, correspondent mortgage lenders, residential mortgage brokers, qualified individual

licensees and mortgage loan originators. These new terms will replace the terms mortgage banker,

mortgage broker, correspondent mortgage banker, secondary lender and registered mortgage loan

solicitor utilized in the New Jersey Licensed Lenders Act. Both residential first and residential

second lending activities are authorized under each of the RMLA licenses.

Pursuant to the changes enacted in the RMLA, all licensed lender licenses with mortgage

banker, correspondent mortgage banker, mortgage broker and/or secondary lender authorities and all

mortgage solicitor registrations renewed on July 1, 2009 will expire on July 31, 2010. The

processing of applications for licensure under the RMLA is anticipated to begin on or about January

1, 2010. The provisions of the Licensed Lenders Act will remain operative until July 31, 2010 to

permit the orderly transition of mortgage licensees and solicitors under the Licensed Lenders Act to

licensure under RMLA. A bulletin outlining specific timeframes for submission of applications for

licensure under the RMLA from current licensees and registrants under the Licensed Lender Act,

and from prospective business entities and individuals requiring licensure under RMLA will be

issued in the near future. All licenses issued under the RMLA during 2010 will expire on December

31, 2010 and will be required to be renewed annually in December of each subsequent year.

The requirements under the RMLA for business licensure as a residential mortgage lender,

correspondent mortgage lender or mortgage broker are as follows:

*completed electronic application through the Nationwide Mortgage Licensing System and Registry

which will assign a unique identifier

*criminal history background check for all officers, directors, partners and owners of a controlling

interest

*general finding of responsibility and fitness for licensure

*licensure of at least one officer, member, director, partner or owner as a qualified individual in

connection with the business entity applicant

*proof of surety bond coverage

*demonstration of tangible net worth

*such other requirements as the Commissioner may impose

*payment of required fees, including non-refundable application fees set by the commissioner that

shall not exceed $2800.

The requirements under the RMLA for licensure as either a qualified individual licensee or

a mortgage loan originator are as follows:

*completed electronic application through the Nationwide Mortgage Licensing System and Registry

which will assign a unique identifier

*criminal history background check, credit report, and check of governmental information related

to administrative, civil or criminal findings

* character and fitness for licensure

* employment by one residential mortgage lender or broker business licensee

*completion of pre-licensing education

*successful passage of written examination

*completion of continuing education requirements during 2011, prior to renewal in January, 2012,

and in each year thereafter

*coverage under employing business licensee’s surety bond

*such other requirements as the Commissioner may impose

*payment of required fees including non-refundable application set by the commissioner fees that

shall not exceed $500

CA Finally Enacts SAFE Act Requiring Mortgage Loan Originators to be Licensed

LA Times Article Published 10-13-2009: CA Governor "Schwarzenegger signs seven mortgage laws" The approved bills provide a variety of home loan protections for consumers, including a ban on so-called negative-amortization loans.  By Marc Lifsher

October 13, 2009  Reporting from Sacramento - In a flurry of end-of-session bill signings, Gov. Arnold Schwarzenegger approved seven new laws that provide a range of consumer protections to home-mortgage holders and may allow some to hold on to their houses.  Late Sunday night, the governor signed AB 260 by Assemblyman Ted Lieu (D-Torrance). The measure, which takes effect Jan. 1, tightens restrictions on mortgage brokers so they cannot steer borrowers to riskier, higher-interest loans when they qualify for less-expensive ones. The new law also bans so-called negative-amortization loans, which offer the option of monthly payments so low that the loan amounts can actually grow over time. ... Other mortgage-related bills signed by the governor:  * SB 36, by Sen. Ron Calderon (D-Montebello), sets licensing requirements for all residential loan originators.

Explanation of Senate Bill 36 From the Legislative Summary of Senate Bill 36: SB 36 brings California Real Estate Law, Finance Lenders Law, and Residential Mortgage Lending Act into compliance with the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (the SAFE Act) by requiring those engaging in mortgage loan origination activities to obtain a license from Department of Corporations after meeting specified requirements, or if a real estate licensee, obtain a license endorsement from the Department of Real Estate after meeting specified requirements. This bill: 1)Would amend California's Real Estate Law, CFL Law and CRML Act in compliance with the SAFE Act.  Specifically, this measure would require mortgage loan originators, as defined, who are licensed real estate brokers to apply for and obtain a license endorsement from the DRE, or if they are a mortgage loan originator employee of a California licensed finance lender or  residential mortgage lender to obtain a mortgage loan originator license from the DOC, as applicable, and obtain a unique identifier, as defined, before engaging in mortgage loan origination activities in connection with a residential mortgage loan in California. 2)Would require applicants for a DRE license endorsement or DOC license to complete at least 20 hours of pre-licensing education and successfully pass an examination on that material, submit to a criminal  history background check and a credit check, and meet several requirements related to their personal character, as a condition of being approved to act as a mortgage loan originator. 3)Would further require licensed mortgage loan originators to renew their DRE license endorsements and DOC licenses  annually , by completing at least 8 hours of continuing education, as specified, and continuing to meet the minimum standards for license endorsement/ approval. 4)Would provide that the Real Estate Law sections of this   measure are operative when the Commissioner of Real  Estate issues a finding that the Nationwide Mortgage Licensing System and Registry is capable of two-way  electronic communication with the enterprise information system maintained by DRE. 5)Would provide that the CFL Law and CRML Act sections of this measure are operative January 1, 2010, but would further provide that no person is required to hold a  mortgage loan originator license under the CFL Law or CRML Act, nor a mortgage loan originator license endorsement under the Real Estate Law, before August 1, 2010.

S.A.F.E. Act - Independent Contractors [Processors & Underwriters] Eligible for Exempt Company Registration

Exempt Company Registration. GA-IN-IA-KY-MD-MA-RI-TN    News Alert posted October 1, 2009 on the NMLS: As of October 1, 2009, several state agencies will offer an Exempt Company Registration for companies who wish to manage their Mortgage Loan Originators in NMLS but are exempt from licensure. The Exempt Company Registration is now available in NMLS for the following states: Georgia, Indiana DFI, Iowa, Kentucky, Maryland, Massachusetts, Rhode Island, and Tennessee.This registration is available for any company that employs state-licensed mortgage loan originators but is not required to be licensed under the laws of the state.  This registration is optional and is intended for companies that wish to manage their mortgage loan originator in NMLS.  Please consult the state regulator before applying for this registration.

Exempt Company Registration. ID   News Alert post August 1, 2009 on the NMLS: Idaho is accepting applications for the Exempt Entity Registration and the Exempt Entity Branch Registration. This registration is only available to entities that solely engage in mortgage loan processing and mortgage loan underwriting functions through independent contractor natural persons who are now required to be licensed mortgage loan originators. This registration is not available to entities that perform mortgage loan origination, brokering or lending activities. 

ID S.A.F.E. Act Established New Requirements for Loan Originators

For Immediate Release July 1, 2009

NEW IDAHO REQUIREMENTS FOR MORTGAGE LOAN ORIGINATORS

Governor Otter Approves Law Implementing New Federally Required Standards

Boise, Idaho . . . Department of Finance Director Gavin Gee announced that new federal standards governing the licensing and oversight of mortgage loan originators took effect in Idaho today, July 1, 2009. The department introduced House Bill 169 this legislative session to implement the federal Safe  and Fair Enforcement Mortgage Licensing Act (S.A.F.E.), which Congress adopted as a part of the Housing and Economic Recovery Act of 2008. The Idaho Legislature passed and Governor Otter signed House Bill 169.  The U.S. Department of Housing and Urban De velopment (HUD) determines a state’s compliance with the federal S.A.F.E. Act mandates,. For states that do not meet those standards, HUD must implement a system for licensing and overseeing mortgage loan originators in that state. “By passing this legislation, Idaho has averted a burdensome dual federal/state mortgage regulatory structure in Idaho,” said Gee. Gee said the federal S.A.F.E. Act requires that all states have a mortgage loan originator licensing system in place by August 1, 2009, utilizing the Nationwide Mortgage Licensing System (NMLS). “Idaho is ahead of most states in this area,” said Gee. “Idaho has licensed mortgage loan originators since January of 2006 and we were among the first states to join the NMLS in January of 2008.” The federal S.A.F.E. Act standards do more than require mortgage loan originators to be licensed or registered in every state through the NMLS. The new s

• credit report checks  •  criminal history checks  •  pre-license testing • pre-license education and post-licensure continuing education • state mortgage recovery fund • annual mortgage call reports • reporting of enforcement actions and public access to this information • consumer complaint processing

The S.A.F.E. Act standards also include a lifetime bar from obtaining a mortgage loan originator license in the United States by anyone who has been convicted of a felony involving fraud, dishonesty, or breach of trust, or money laundering. Under the federal standards, an applicant for a mortgage loan originator license must not have any other felonies within the seven years immediately preceding the date of the license application. Gee said Congress also stipulated in the S.A.F.E. Act that any person who has had a mortgage license revoked anywhere in the United States is barred from ever obtaining a mortgage loan originator license. Another important change in Idaho law as a result of House Bill 169 involves mortgage modification services. “In the current economy the department is receiving an increasing number of complaints against third-party providers offering advance-fee mortgage loan modification services,” said Gee. “Beginning today, offers of mortgage loan modification services by third-party providers will be regulated under the provisions of the Idaho Residential Mortgage Practices Act. Individuals and companies offering mortgage loan modification services for others in Idaho will have to obtain a license under the new law and will be restricted from charging certain upfront fees for their services.” Gee commended the Idaho Association of Mortgage Brokers and the Idaho Mortgage Lenders Association for their support and work on passage of the S.A.F.E. Mortgage Licensing Act in Idaho. “We’re fortunate in Idaho to have these statewide mortgage associations whose members seek to enhance professionalism in the industry and promote sound mortgage brokering and lending practices.” House Bill No. 169 can be accessed on the Internet website for the Idaho Legislature at: http://www.legislature.idaho.gov/legislation/2009/H0169.htm   or can be obtained by contacting the  Department at (208) 332-8002. Department of Finance Press Releases and other information can be found on the Department’s website at  http://finance.idaho.gov and may also be obtained by contacting the Department at (208) 332- 8000 or Idaho toll-free at 1-888-346-3378.

S.A.F.E. ACT IMPLEMENTED BY STATES BY JULY 31, 2009

 S.A.F.E. ACT IMPLEMENTED BY STATES BY JULY 31, 2009

("SAFE Act"), was passed on July 30, 2008. The SAFE Act gave states one year to pass legislation requiring the licensure of mortgage loan originators according to national standards and the participation of state agencies on the Nationwide Mortgage Licensing System and Registry (NMLS). States have moved in an unprecedented manner in just

Title V of P.L. 110-289, the

Secure and Fair Enforcement for Mortgage Licensing Act of 2008

ONE YEAR to accomplish the following:

Legislation:  

49 states and the District of Columbia have enacted or introduced legislation implementing the SAFE Act. 47 states and the District of Columbia have already passed legislation, and  2 states [CA and PA] and Puerto Rico and the Virgin Islands have legislation pending in legislatures that are still in session.  MN has no legislation pending. All legislation enacted to date includes standardized definitions, national pre-licensure and continuing education and testing requirements, and criminal background standards for mortgage loan originators as contained in the SAFE Act. Virtually all of the legislation enacted to date includes a robust set of prohibited acts and practices to protect consumers as promoted in the CSBS/AARMR Model State Law.  Uniformity in mortgage regulation has been fostered and driven by enactment of the SAFE Act as the 50 existing state licensing laws are revised in a nationally consistent manner to establish standardized licensing applications, processes and practices.

 

Public Law 110-289

TITLE V—S.A.F.E. MORTGAGE LICENSING ACT

‘‘Secure and Fair Enforcement for Mortgage Licensing Act of 2008’’

Mandates of P.L. 110-289

Industry 

All residential mortgage loan originators must be either state-licensed or federally registered. A mortgage loan originator employed by a federally insured depository institution or any credit union or an owned and controlled subsidiary that is federally supervised must be registered. All other mortgage loan originators, without exception, must be state licensed. All state licensed and federally registered mortgage loan originators must be registered with the Nationwide Mortgage Licensing System & Registry maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators.

 

States 

states must have a system of licensing in place for residential mortgage loan originators by August 1, 2009 that meets national definitions and minimum standards, that include, among other things: criminal history and credit background checks; pre-licensure education; pre-licensure testing; continuing education; net worth, surety bond or recovery fund. All states must license mortgage loan originators through NMLS&R.

 

U.S. Department of Housing and Urban Development (HUD) 

HUD must determine: That the state’s mortgage loan originator licensing standards meet the federally mandated minimums, and That the state is participating in NMLS&R. If HUD determines that a state not in compliance with both items above, HUD must implement a system for all state licensed mortgage loan originators in that state.

 

 

 

Federal Banking Agencies/Federal Financial Institutions Examination Council/Farm Credit Administration Must develop and maintain a system for registering employees of federally insured depositories and subsidiaries they own and control, and employees of Farm Credit Administration regulated entities, with NMLS&R. Registering with NMLS&R requires registered loan officers to submit fingerprints for a state and federal background check and personal history and experience. Shall coordinate with NMLS&R in assigning unique identifier.

Conference of State Bank Supervisors/American Association of Residential Mortgage Regulators

CSBS and AARMR must develop and maintain the Nationwide Mortgage Licensing System and Registry for the purposes identified in the Section 1502 of P.L. 110-289.

 

Nationwide Mortgage Licensing System and Registry

NMLS&R must establish protocols for the issuance of unique identifiers. NMLS&R must receive and process fingerprints for national and state criminal history background checks for all loan originators. NMLS&R must review and approve, using reasonable standards, pre-licensure and continuing education courses. NMLS&R must develop a qualified written test and approve test providers. NMLS&R must develop a mortgage call report. NMLS&R must provide public access to licensing information.