On November 1st, the NMLS will enable two new functionalities in the system that every licensed Mortgage Loan Originator will need to access:
1) 2011 License Renewal
2) Credit Report Request
The license renewal process will be streamlined for all MLOs who have kept their NMLS record up to date. We recommend logging in to the NMLS system and verifying all of your personal data prior to submitting your renewal request. Fees for all states, the list of state deadlines and a handbook for the renewal process can be found at the following link: http://mortgage.nationwidelicensingsystem.org/slr/common/renewals/Pages/default.aspx
While you are verifying your personal information, please ensure that you have met your education, criminal background and testing requirements as well. If you need assistance in figuring out what education you need to remain compliant with the law and continue to originate, don’t hesitate to contact us.
We know you are responsible. Does your regulator?
The “financial responsibility requirement” for licensure as an MLO was contained in the SAFE Act, however it has not drawn much attention recently for the simple fact that the NMLS system was not capable of handling the credit report processing needed to fulfill that requirement. As of November 1st, the functionality will be made available, and all licensed MLOs will need to request a credit report prior to the deadline imposed by the state(s) in which they are licensed. Most states have a deadline of March 1, 2011, although some require the report to be requested through the NMLS by December 31, 2010. For example, Illinois’ deadline is March 1, 2011. However, if you are licensed in neighboring Indiana and your license is issued by the INDIANA SECRETARY OF STATE, you must request your credit report by December 31, 2010. Strangely enough, licenses issued by the Indiana Department of Financial Institutions have until March 1, 2011, to comply with the credit requirement.
Don’t leave your fate up to the state!
Note that there are no automated systems inside the NMLS system that will handle evaluation of credit reports. Decisions on what constitutes “acceptable credit” are left entirely up to the state regulators. We believe that Illinois will be more understanding of derogatory information than many other states, as long as there is a reasonable explanation. In any case, expect states to require letters of explanation for all derogatory credit appearing on an applicant’s report. If you have any concerns about derogatory credit affecting your ability to originate loans, please contact the state regulators FOR EACH STATE in which you are licensed (or hope to become licensed) and discuss your situation with them.
We don’t want to see anyone put in a position where one state approves a credit report but another state does not and rejects the license. That would make it theoretically possible for individuals to have all of their licenses revoked or placed in a “refuse to renew” status. While we hope that there will be procedures in place to ensure that does not happen, there is no guarantee. Don’t take chances with your career when a simple phone call will answer your questions.
More information about the credit requirement, including the $15 fee for requesting the TransUnion report, can be found at the following link: http://mortgage.nationwidelicensingsystem.org/profreq/credit/Pages/default.aspx