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Mortgage Licensingby Paul Donohue Mortgage licensing requirements have changed as the economy has evolved. It used to be that mortgage brokers and loan officers were accountable to their employers and possibly to their state department of compliance. But in an effort to ensure protection for consumers against mortgage fraud, the SAFE Act and the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 was passed on July 30, 2008. The new federal law 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). The SAFE Act is designed to increase consumer protection and reduce fraud by setting minimum standards for the licensing and registration of state-licensed mortgage loan originators. The National Mortgage Licensing System initiative was started by state mortgage regulators in 2004 as a response to the increasing volume and variety of residential mortgage officers and the need to address changes in the economy with current tools and supervisory bodies. NMLS was created by the Conference of State Bank Supervisors (CSBS) and the American Association of Residential Mortgage Regulators (AARMR) to improve supervision of the mortgage industry, streamline and make the licensing process for mortgage companies and professionals more consistent, and to enhance protection of borrowers. As part of the requirements for compliance with the Nationwide Mortgage Licensing System and Registry, applicants must complete a minimum of 20 hours of education in order to be licensed, and they must complete 8 hours of CE classes annually to remain in compliance. Mortgage licensing education provided by Abacus Mortgage Training and Education provides a broad overview of federal laws and regulations, general mortgage concepts, origination of the loan (both ethics and mechanics), non-traditional mortgage products, ethics and consumer protection, and the entire loan application process. Another requirement of the Nationwide Mortgage Licensing System and Registry is fingerprinting and a background check. Every mortgage loan originator (MLO), whether state-licensed or federally registered, is required to complete a Criminal Background Check Authorization Request (CBC). The request for the background check is required in order to submit the NMLS application form. Either an individual MLO or their employer may create the CBC Authorization Request through the NMLS. When an individual or employer has paid for the CBC request through Nationwide Mortgage Licensing System and Registry, the loan officer will be able to schedule a fingerprint appointment. Consumers are able to access the Nationwide Mortgage Licensing System and Registry to view the background information and record of specific loan officers for their own peace of mind and protection. Knowing the loan officer has passed the requirements for registration and compliance will give you confidence in the loan officer’s ability to represent your best interests. Abacus Mortgage Training and Education provides comprehensive education required for mortgage licensing on the federal level and with individual states.
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