September 2008 Mortgage Licensing Update


With the mortgage crisis still in full force, many countries are looking for a way to increase the monitoring of the mortgage industry. The first step to regulate the mortgage company is licensed companies and their sales people. Many new states have adopted rules this month requiring additional licensing.

North Carolina Passes new mortgage Songs, Banning YSP and licensing for servicers

Effective October 1, 2008, House Bill 2188 changes the interest rate differential Home Loan Law to prohibit the payment of yield spreads on the spread of home loans. Make sure to look at the definition of home loan interest margins. Entered into force on 1 January 2009, House Bill 2463 changes the Mortgage Lending Act to require the licensing of mortgage loan servicers.

Delaware Requires Loan originator Licensing

effect on January 1, 2009, the Loan authors will be required to be licensed in Delaware. HB 508 defines mortgage originator as an employee or independent contractor license Delaware Mortgage Broker or Lender. The legislation requires mortgage loan originator to apply to the Office of the State Bank Commissioner for mortgage loan originator license, confirming and continuing education requirements for licensees, and authorizes the Commissioner to adopt rules to facilitate participation in the Nationwide Mortgage licensing system. Delaware House Bill 508 will take effect on January 1, 2009, mortgage loans authors will not be required to get a permit from the State Bank Commissioner enforces the implementation of the new law license. The bill requires that the sender loan holders have at least 18 hours of continuing education courses within five years of licensing or within a year of licensing. Applicants may work as a mortgage loan authors of the original work temporarily until the person is licensed or the application is refused. Applicants must submit a $ 250 investigation fee and $ 250 annual license fee.

Virginia converter Regulations require initial and continuing

The Virginia State Corporation Commission recently published changes to regulations governing the implementation of the mortgage lender and broker law. The new regulation:

(i) require licensees to conduct background checks;

(ii) prohibit licensees from hiring a person who has been convicted of a felony or misdemeanor involving fraud, misrepresentation or fraud, without obtaining prior approval from the executive office of financial institutions; and

(iii) licensees responsible for education and lifelong learning, as specified in the amendments to “drop employees.”

The new regulations came into force on 10 August 2008. Under the new regulation, mortgage holders are responsible for providing initial and continuing training to drop their employees at least annually with respect to all laws and regulations that apply business licensees.

basic education shall consist of at least twelve (12) hours for the applicable federal laws and regulations, at least four (4) hours which will connect the existing Virginia laws and regulations, and two (2) hours must appeal to mortgage fraud prevention, including penalties for involvement in mortgage fraud. Basic education should be provided to persons who were covered employees as of 1 July 2008 on or before May 1, 2009, and to persons in the Covered employees after July 1, 2008, within 90 days from the date of hire. Continuing shall consist of at least four (4) hours to existing federal laws and regulations, at least two (2) hours to existing Virginia laws and regulations, and at least one (1) hour for mortgage fraud prevention, including sanctions participation in mortgage fraud.

In addition, the regulation prohibits licensees from hiring any individual for employment status that may have access to personal information or financial information to customers, without obtaining criminal history record from the Central Criminal Records Exchange showing the prospective employee has not been convicted in any court of any felony or misdemeanor involving fraud, misrepresentation or fraud under the laws of any state or the United States.

Florida Bars criminals from Mortgage Licensing

Florida adopted an emergency rule change prohibiting people with criminal history would get permission to work in the mortgage industry. The rule prohibits the Florida Office of Financial Regulation of the issue of Florida mortgage broker, mortgage lender, correspondent lender or mortgage broker business license to an applicant for a certain period (ranging from 5 to 15 years) if the applicant or the “relevant parties” in the applicant (ie, officers, directors, members, partners, controlling persons and joint venturers) have been found or pled guilty or no contest in various felonies or misdemeanors. The rule allows to reduce factors that could lengthen or shorten the period of incapacity. The emergency rule will remain in force until regular rulemaking is completed.


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