The Nationwide Mortgage Licensing System and Registry is ready for federally insured banks, thrifts and credit unions to register their loan officers, according to federal and state regulators.
Nonbank LOs and brokers have already completed the registration process after passing competency tests and undergoing criminal background checks. LOs with federally regulated depositories only have to register on the system, obtain a unique identifier, and maintain their registrations. Bank LO registrations began Monday, Jan. 31.
The identifier makes it possible to track LOs as they change jobs and move from state to state. The system gives regulators another tool to sanction LOs who break the rules. The different requirements between state-licensed LOs and bank LOs is spelled out in the Secure and Fair Enforcement for Mortgage Licensing Act that Congress passed in 2008.
Bank LOs don't have to rush to register either, according to a joint notice issued by federal regulators. Bank LOs have 180-days to complete the registration process. After July 20, 2011, "any existing employee or newly hired employee of any federally regulated institution" who is subject to the SAFE Act registration requirements will be prohibited from originating residential mortgage loans without first meeting such requirement," the joint notice says.
Bank LOs that originate five or fewer loans during the previous 12 months are not required to register.
The Conference of State Bank Supervisors, and American Association of Residential Mortgage Regulators developed the Nationwide Mortgage Licensing System. Under contract from the federal agencies, CSBS modified the system to create the registry for LOs at federally regulated institutions.
