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Loan originator rules

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  • #3449
    wp27
    Participant

    I am reading over the small entity compliance guide for the Loan Originator rules and it says you may be a loan originator if you refer a consumer to a loan originator or creditor, but then says you are not a loan originator simply because you provide contact info for fellow employees upon the consumer’s request as long as you don’t refer the consumer to a particular loan originator based on the consumer’s financial characteristics. Our tellers and CSRs are supposed to refer people to our lenders. However, they do not refer them based on their financial characteristics, just based on if the loan is consumer or commercial. Am I right that this does not make them mortgage originators?

    Also, our commercial lenders were not licensed under the SAFE Act, if we license them now, does that cover them for the new rule? I was thinking this would be the safest thing to do since they do refer to consumer lenders based on financials sometimes…

    #3450
    cmitchell
    Member

    If you look at the commentary to 1026.36(a), it describes managers and administrative staff and similar individuals who are employed by the creditor but do not receive compensation based on whether any particular loan is originated as not being loan originators.

    We also have our tellers refer customers over to the personal bankers for equity loans and mortgage area for purchases. We don’t have paper applications and the tellers do not have access to the loan system to imput a lending application. One of the controls that we put in place with the SAFE Act was that (with the exception of audit staff) only persons with a NMLS number were to be given access to the loan system.

    That was our interpretation of the loan originator rules – the tellers are not able to input or ‘take’ an application so they would not need to be registered. We didn’t want any employees outside of the ones registered to be helping customers with application questions. May not be ‘good customer service’ but hopefully it keeps us in compliance.

    #3486
    wp27
    Participant

    I guess it is the part about making referrals that has me confused. That isn’t mentioned anywhere in the S.A.F.E. act so this part seems to be specific to the new rules. It also mentions advertising, so this would include those in Marketing for the bank?

    Is getting them registered under the S.A.F.E. act the safest way if they must meet some kind of standards now? Or would we be better to meet the standards in the new rule?

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