Effective July 1, 2010,
All loan originators need to be licensed in Arizona unless they have certain state exemptions. That exemption is under statue 6-991.01 . With this new license comes new regulations on both the federal and state statue. Most of these laws change not only the definition of a law originator, but who is qualified to give mortgage advice to the consumer.
The reason I sharing this is because I am still seeing many people who do not or will not fit the definition of a loan originator giving mortgage advice. Your professional license may not protect you for giving this advice and you will want to treat this like giving legal or tax advice. You will want your client to seek the service of a professional mortgage originator that is licensed.
6-991.08.Reasonable efforts to secure advantageous loan for borrower
A loan originator shall make reasonable efforts to secure a loan that is reasonably advantageous to the borrower considering all of the circumstances, including the interest rates, charges and repayment terms of the loan.
The days of anyone except a licensed mortgage orignator giving mortgage product advice in Arizona is OVER. I am stressing this again because the rules to protect the consumer have changed and the state of Arizona now has clear definitions of who does or does not fit this criteria. Basically unless you are a licensed loan originator or fit the exemptions, you should not and cannot give any mortgage product advice.
I have said this before, but I will say it again. I see two types of mortgage originators surviving this market. Type 1 is going to work for a big bank and you will have to call a 1-800 number to get your loan. You will probably talk with 2-5 people throughout the process, but can feel confident that you will get the product you seek based on the company's reputation. Type 2 is a category I feel that I fit well into; a loan officer with a reputation of providing exceptional mortgage advice on a local level. This means being involved personally with the customer and mortgage transaction from the beginning to the very end. I also see a huge gap level surfacing between the folks that know how to do a mortgage loan correctly, and someone who is going to make mistakes.
At the end of the day, consumers will still buy homes and homeowners will need a mortgage. You will need a mortgage lender to provide this service. A piece of paper saying I can pass a test does not make me a reputable loan officer; having a reputation that is backed up from prior clients and business partners does.