Make Sure Your Mortgage Loan Officer Is Licensed

By
Mortgage and Lending with George Souto NMLS #65149 FHA, CHFA, VA Mortgages NMLS #65149

By the end of this year, all Mortgage Loan Officers and Mortgage Brokers, that work for a Non-Depository Lender, will need to be licensed in every State in order to take a Loan Application and put a Loan in process, so make sure your Mortgage Loan Officer is licensed.   For right now Mortgage Loan Officers for Depository Lenders like Banks, and Credit Unions, are excluded from being required to be licensed, presently all they need to do is be registered under their Lending Institutions License.

Up to now licensing for Mortgage Loan Officers was optional for each State, but under the  Secure and Fair Enforcement for Mortgage Licensing Act of 2008, which is part of the FHA reform bill, put into place National Standards for Mortgage Loan Officers.  With this change all Mortgage Loan Officers that work for a Non-Depository Lender in all States will be part of a mandatory registration system called the Nationwide Mortgage Licensing System (NMLS).

In my opinion this is a MAJOR positive move on the part of Lending Industry, and hopefully Mortgage Loan Officers that work for Depository Lenders will also be required to be licensed in the near future.  Right now the Banking Lobbyist have been able to prevent this from happening, but the pressure for their Loan Officers to also be licensed will increase, and they will also have to comply.

This is bound to reduce the number of Mortgage Loan Officers presently doing business in every State.  Those that will most likely be impacted most by this new law are Internet Lenders, because Mortgage Loan Officers have to be licensed in EVERY State that they do business in, and cannot use the license of someone else to write Loans.  This is because an individual cannot even take information to complete a Loan Application without being licensed in that State.

Cost will also be a major factor in all this.  In Connecticut the cost to license a Mortgage Loan Officer is $330.  This amount may vary from State to State, but it does not take long for those licensing fees to add up.  Furthermore, the Mortgage Loan Office will need to past that States Licensing Test on top of passing a National Licensing Test in order to be licensed.  If the State Test for other States is anything like the Connecticut State Test, it will not be easy to pass.  Many have taken the Connecticut State Test this year and failed.

The way that you will know that your Mortgage Loan Officer is licensed is by an NMLS Number, mine is NMLS# 65149.  This number must appear on everything that identifies someone as a Loan Officer like business cards, flyers, e-mail, websites, etc.  If your Mortgage Loan Officer does not have an NMLS# then he or she is not licensed, and you should be looking for someone else to partner with in case they do not obtain their license by the end of the year.  In fact in Connecticut Mortgage Loan Officers will need to have taken and past the National and State Tests by October 31.

Once a Mortgage Loan Officer has past their National and State Tests, they will need to take 8 hours of continuing education classes each year in order to maintain their license.  20 hours of educational classes are originally needed to obtain the Mortgage Loan Officer License.

So make sure your Mortgage Loan Officer is licensed, or fine one who is!!!

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Info about the author:

George Souto is a Loan Officer who can assist you with all your FHA, CHFA, and Conventional mortgage needs in Connecticut. George resides in Middlesex County which includes Middletown, Middlefield, Durham, Cromwell, Portland, Higganum, Haddam, East Haddam, Chester, Deep River, and Essex. George can be contacted at (860) 573-1308, gsouto@mccuemortgage.com, or visit my McCue Mortgage Homepage.

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 Info about the author:

George Souto NMLS# 65149 is a Loan Originator who is licensed in #CT, #RI, #MA, #NH, & #FL and can assist you with all your #FHA, #Conventional, #VA, #USDA, and #State Bonded Progam #mortgage needs in #CT, #RI, #MA, #NH, & #FL. George resides in Middlesex County which includes #Middletown, #Old Saybrook, #Middlefield, #Durham, #Cromwell, #Portland, #Higganum, #Haddam, #East Haddam, #Moodus, #Chester, #Deep River, and #Essex. George can be contacted at (860) 573-1308 or souto@snet.net

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Re-Blogged 6 times:

Re-Blogged By Re-Blogged At
  1. Adam R. Cohn 08/11/2010 03:07 PM
  2. Dana Voelzke 08/11/2010 03:19 PM
  3. Dub Walters 08/12/2010 01:38 AM
  4. Bob & Leilani Souza 08/12/2010 08:32 AM
  5. Rebecca Gaujot, Realtor® 08/12/2010 08:42 AM
  6. John Pusa 08/12/2010 08:55 AM
Topic:
Mortgage / Finance
Location:
Connecticut
Groups:
Realtors®
Mortgages
What is New in Loan Products
1st Time Buyers
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Tags:
fha
connecticut
chfa
va
usda mortgage loans

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Ambassador
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Paul McFadden
Paratex - Seattle, WA
Pest Control, Seattle, WA.

George: Thanks for the tip and the post. I appreciate it. Licensing should help to continue to weed out those loan officers who aren't committed. That being said, I wish everyone (banks included) had to undergo the same set of rules. It makes me wonder if the banks wrote the new rules to begin with! Take care.

Aug 12, 2010 06:56 AM #42
Rainer
28,555
Tricia Houston
Lending Maven Mortgage - Denver, Colorado - Highlands Ranch, CO

it has already weeded out TONS of people in Colorado....really kind of nice!

Aug 12, 2010 07:18 AM #43
Rainmaker
1,245,364
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

George:  Just as an added comment ... I personally have heard comments from those that either did not want to take the test ... or feared taking it ... or took it and failed, that they are indeed looking to depository banks for employment.  That raises all sorts of questions in my mind.  I should think that it should in others, as well ...

Good post to get people talking and more aware of these changing rules and regulations ...

Gene

Aug 12, 2010 07:21 AM #44
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Integrity Real Estate Services 118 SE AVE N, Idabel, OK 74745 - Idabel, OK
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George,

I didn't read through all of the comments but most of them.  It seems everyone is positive about this happening.

Anything that can be done to make sure that mortgage originators are educated in their field and have some required guidelines and expectations is wonderful.

I know this puts a lot of education and testing on you.  I hope that business is good to help overcome the cost and hassle of what you're going through. 

Thank you for bringing us up to speed on this.

 

Aug 12, 2010 07:52 AM #45
Rainmaker
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Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Good awareness post........and I offer a thought.......

The answer to all our problems doesn't lie in regulation all the time. I only deal with people I know and trust. In the end, banks, who were very regulated went belly up. So much for regulations.....

Thank you George....

Aug 12, 2010 08:42 AM #46
Rainmaker
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John Pusa
Berkshire Hathaway Home Services Crest - Glendale, CA
Your All Time Realtor With Exceptional Service

George - Excellent post. Thank you for sharing avery important blog.

Aug 12, 2010 08:52 AM #47
Rainer
284,418
Steven Cook
No Longer Processing Mortgages. - Tacoma, WA

George,

Thanks for getting the word out!  I'm still trying to find out how we get this information to the consumers without having to pay for a lot of media coverage.

With regard to Deborah's comment (#28) - California either has smarter loan officers or easier quiz, as the numbers in WA state are about 80% failure.  Here anyone licensed before this year has until the end of the year to pass national test, and get their background check run.  The rest of us had to be done by July 1.

Additional note -- most mortgage brokers are having tough time making it under new regulations, as any YSP funds have to be used solely for the benefit of the client, and as brokers there are some $2,000 - $2,500 in loan fees that they have to pay and cannot pass on to the client.

Thanks again for the blog.

License #293441

Aug 12, 2010 09:38 AM #48
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George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Paul I don't know if they wrote the rules, but I do know they spent a lot of money to influence them.

Tricia, there will be more that will be weeded out by the end of the year.

Gene, those that can't pass the test only have one way to turn, and that is to those that spent a lot of money to make sure they were excluded.

Judi, I was very busy during the time I was studying to take the test, but it was worth it, and I am glad it is behind me.  Now I have to figure out what classes I want to do my 8 hours in next year.

Richie, they might have been regulated, but they streached the guidelines to the Max, and all of the ones that went under that I know of were heavy into the sub-prime loans.  It does not matter how big you are, when you take the guidelines to the edge over and over, you will not be around for long.

John you are welcome.

Steven the States that developed their test early seem to have a better passing percentage because information on what is on them is out there.  The States that developed their tests late, have very little information that is public, and therefore, the Loan Officers in those States are finding it more difficult.  Connecticut developed it's test real late, and even though we have easy access to the laws that are on it, the way the questions are asked and the material applied is almost not existent.  On another note Brokers are getting hit hard from all directions, many of the Brokers around here are finding it very difficult to keep their doors open.

Aug 12, 2010 04:06 PM #49
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1~Judi Barrett
Integrity Real Estate Services 118 SE AVE N, Idabel, OK 74745 - Idabel, OK
BS Ed, Integrity Real Estate Services -IDABEL OK

George, Do you have unlimited choices in your CE hours?  We have to choose certain areas that are approved by OREC for our 23 hours. 

Aug 13, 2010 03:10 PM #50
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George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Judi, we also have to choose our 8 hours of continuing ed in certain areas:

  • 3 hours of federal law and regulations
  • 2 hours of ethics, including fraud, consume protection and fair lending issues.
  • 2 hours of lending standards for nontraditional mortgage products.
  • 1 hour of electives.

Originally in order to be licensed we had to do 20 hours of class time in the same areas:

  •   3  hours of federal law and regulations
  •   3  hours of ethics, including fraud, consume protection and fair lending issues.
  •   2  hours of lending standards for nontraditional mortgage products.
  • 12  hour of electives.

Also we can not take the same classes in consecutive years, and as in your case our classes also have to be certified.

Aug 14, 2010 04:30 AM #51
Rainmaker
325,871
Esko Kiuru
Bethesda, MD

George,

This new law will make a positive impact on the mortgage industry, retaining and bringing in more professional loan officers on board. Everyone benefits.

Aug 14, 2010 01:51 PM #52
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George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Esko I agree!!!

Aug 14, 2010 03:15 PM #53
Rainmaker
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Ann Hayden 636-399-7544
Berkshire Hathaway HomeServices Select Properties-St. Louis Missouri - Chesterfield, MO
SelectAnn.com

George,

So do you have to produce the license if someone asks to see it?

Ann Hayden in Wildwood, MO

Aug 15, 2010 02:10 AM #54
Rainer
422,958
Peggy Chirico
Prudential CT Realty - Manchester, CT
REALTOR® 860-748-8900, Hartford & Tolland County Real Estate

Hi George - I started seeing the license numbers on email signatures but wasn't aware of all the details.  I think it's a great thing because there is nothing better than having a knowledgeable mortgage person every step of the way. Thanks for the information.

Aug 16, 2010 10:52 AM #55
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George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Ann they do not issue each Loan Officer an individual certificate, they just issue a NMLS number and that number is then displayed on everything.

Peggy your welcome.  That number will also serve as a pre-notice as to who might not be around here in Connecticut after October 31.

Aug 16, 2010 02:10 PM #56
Rainmaker
930,656
Ann Hayden 636-399-7544
Berkshire Hathaway HomeServices Select Properties-St. Louis Missouri - Chesterfield, MO
SelectAnn.com

George,

Thank you for the clarification....  ;-)

Ann Hayden in Wildwood, MO

Aug 17, 2010 04:37 PM #57
Rainmaker
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Bill Gassett
RE/MAX Executive Realty - Hopkinton, MA
Metrowest Massachusetts Real Estate

George I never even realized you could practice doing mortgages without a license!

Aug 18, 2010 12:43 AM #58
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Celeste "SALLY" Cheeseman
Liberty Homes - Mililani, HI
(RA) AHWD CRS ePRO OAHU HAWAII REAL ESTATE

MAKE SURE!  I have always believed that one who has education, licensing and also monitoring..just may be someone I'd like to work on the other side of. Thanks George..you give some great reasons why...or even why not.

Aug 24, 2010 10:15 AM #59
Rainmaker
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Nick T Pappas
Assoc. Broker/Broker ABR, CRS, SFR, e-Pro, @Homes Realty Group, @HomesBirmingham & Providence Property Mgmnt, LLC Hun... - Huntsville, AL
Madison & Huntsville Alabama Real Estate Resource

Hey George, just stopped by to say hello and belatedly congratulate you on the feature...well deserved my friend.

Aug 24, 2010 03:49 PM #60
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Integrity Real Estate Services 118 SE AVE N, Idabel, OK 74745 - Idabel, OK
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George, I love it when you write a post.  It's always soooooooooooooooo worth reading.  You put a lot of thought and work into one and always have something worthwhile to write.  BLOG ON!

Aug 25, 2010 03:23 PM #61
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