Topics In This Issue
• Federal Issues
• State Issues
• Firm News
• Consumer Finance
• Credit Cards
Excerpt from "Federal Issues"
Federal Agencies Issue Final SAFE Act Rules; Letter Urges HUD to Issue SAFE Act Guidance. On July 28, federal agencies issued final rules regarding the registration of employees who act as mortgage loan originators (MLOs) at banks, savings associations, Farm Credit System institutions, credit unions, and certain of their subsidiaries (collectively, Banking Institutions), as required by the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (SAFE Act). The final rule was issued by the Office of the Comptroller of the Currency, Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, Office of Thrift Supervision, Farm Credit Administration, and National Credit Union Administration (the Federal Agencies). The SAFE Act requires MLOs employed by Banking Institutions to register with the Nationwide Mortgage Licensing System and Registry (NMLS&R). The Federal Agencies’ final rule generally defines an MLO as an individual who (i) takes a residential mortgage loan application and (ii) offers or negotiates terms of a residential mortgage loan for compensation or gain. Notably, this definition of is more narrow than the definition of an MLO contained in the Dodd-Frank Wall Street Reform and Consumer Protection Act. The final rule excludes from its registration requirement both individuals engaged in mortgage loan modifications and assumptions as well as individuals who service mortgage loans, provided that such individuals do not also originate new loans. The final rule will be effective October 1, 2010; however, the Federal Agencies do not expect that the NMLS&R will be ready to accept MLO registration applications before January 28, 2011. MLO employees of Banking Institutions will have 180 days to register and obtain unique identifiers after the NMLS&R begins accepting MLO applications.
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