Policy, Procedures, and Examinations - Mortgage Brokers

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In this article, the first of a two-part series, I am going to provide a chart of certain core policies and procedures that a mortgage broker should obtain and continually update, as regulations change. I will also provide some useful policy implementation guidance relating to preparing for a state banking examination.

In part two of this series, I will address the central policies and procedures that are needed by mortgage bankers.

Perhaps the most difficult task of the independent mortgage professional is to obtain and maintain a full set of policies and procedures. Too often, a broker’s approach to compiling adequate policy statements is reactive; that is, the demand comes about in order to meet a regulator’s expectations or in anticipation of a forthcoming examination.

Many brokers simply make it their business to always be prepared, especially in this highly regulated financial services industry. I have said many times, preparation is protection! Indeed, I have written extensively on this theme.

Nevertheless, all the policy statements in the world will not impress a regulator if that policy’s stated requirements are not really implemented. In other words, the examiner will determine if a firm’s procedures are actually being followed.

Let’s put it this way: a policy statement, without implementation, is merely pontification!

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