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LOAN ORIGINATOR LICENSING

July 1, 2010

The Housing and Economic Recovery Act of 2008, HERA, was signed into law on July 30, 2008. A key component of HERA is the Secure and Fair Enforcement for Mortgage Licensing Act, SAFE. The SAFE Act requires Nationwide Mortgage Licensing System, NMLS, registration for all mortgage loan originators. This is intended to create a centralized national database of disciplinary information for individuals originating residential mortgage loans.

In addition to NMLS Registration, the SAFE Act also requires state licensure for each state in which the loan officer originates loans. The licensing process is facilitated through the NMLS and its systems. State-licensed mortgage loan originators must;

1. Submit fingerprints through NMLS for an FBI criminal background check.

2. Complete 20 hours of pre-licensure education and 8 hours of continuing education.

3. Pass the National and State Component of the SAFE MLO Test with a score 75% or better. As of April 30, 2010 the pass rate for the national exam is 71% (up from 68% in March, and about 30% a year ago). Stats are from NMLS. I scored a 92%.

4. Provide authorization for a credit report through NMLS.

Even with my experience, the time spent in classes, studying & taking the test, getting fingerprinted, the criminal background check and the completion of all the online info along with the volume of paperwork, I spent at least 100 hours in order to get licensed, not to mention about $1,100.00.

Amazingly enough, with all of the passion and legislation that now requires loan originators to be licensed, originators who are employees of a FDIC insured bank or savings and loan, its subsidiary, or an institution regulated by the Farm Credit Administration are required to register with the NMLS but are EXEMPT from the state licensing, testing and education requirements of the Act. Go figure???? I find that extremely frustrating! I am not aware of any other industry where licensing is required, but certain privileged individuals are EXEMPT.

Real Estate Agents, Insurance Agents, Security and Investment Advisors, CPA’s, and Attorneys are all required to be licensed. So why are certain bank loan officers exempt?? I guess the banks just didn’t receive enough bailout money to pay for it.

A little humor goes a long way..

The Arizona Department of Financial Institutions requires that all loan originators be licensed by July 1, 2010. Loan originators may not transact business in Arizona as a loan originator unless they are licensed by our Department.

Please note, if you are working with an LO that is not licensed, On July 1^st, they cannot negotiate the transaction. This could create an issue for the buyer as the file may be handed off to another LO that really does not know the intricacies of the loan.

Be sure that you are working with a Licensed Mortgage Loan Originator. Below is the link to check and see if your loan officer is licensed. You will need to enter Name, company, city, state and NMLS#.

My info is listed below. I have been licensed since February 2010.

http://www.nmlsconsumeraccess.org/

Zoltan Holubecz, Precision Mortgage, Inc., Glendale, AZ, 85302, 215551

Call me if I can be of any assistance.

Thank you.