August 5, 2013 at 12:59 pm #3765tstraitParticipant
We are considering hiring a broker. He is currently registered with the NMLS and state. I called the NMLS helpline, but no one was able to advise me on how to transition him.
If he has loans that have been started in July and/or August, but aren’t quite finished processing, what are his restrictions for registering with us? For example:
He takes an application 8/1 (under his Mortgage Company’s name), but it won’t close till 9/15/2013 (funded by another financial institution other than us). We want him to start 9/3/2013. Is there a problem with the 8/1(application) loan closing with him registered to us?
All I can see (in my research) is that once the process originates, it has to close with the same COMPANY, not necessarily the same MLO. . . . Would it make a difference if he was a sole propietor (broker), and once he leaves there would be no other MLOs?August 5, 2013 at 3:51 pm #3768rcooperKeymaster
There isn’t anything in the SAFE Act that suggests there would be any restrictions with the MLO changing jobs and registering with a new employer, even if loans are in progress with the current employer. I recommend, if there are loans in progress, the NMLS ID number of the MLO taking over/closing the loans be used where required on any remaining/closing documents. Either way, if there is a new MLO or if there is a loan originator who meets the de minimis exception in the SAFE Act closing the loan, I would recommend a nice letter to the applicant(s) informing them of their new MLO and include his/her NMLS #, if applicable. This would show a good faith attempt to inform the borrower(s) whom they are dealing with, which goes to the intent of the law (and be sure to keep a copy in the loan file).
Below is an excerpt from
Regulation Z Official Staff Interpretations, Paragraph 36(g)(1)(ii).
This is effective 1-10-14. I think it follows the same line of thought, that there could be two different loan originators during the course of the loan, disclosing the applicable NMLS # at the time.
1. Multiple individual loan originators. If more than one individual meets the definition of a loan originator for a transaction, the name and NMLSR ID of the individual loan originator with primary responsibility for the transaction at the time the loan document is issued must be included. A loan originator organization that establishes and follows a reasonable, written policy for determining which individual loan originator has primary responsibility for the transaction at the time the document is issued complies with the requirement. If the individual loan originator with primary responsibility for a transaction at the time a document is issued is not the same individual loan originator who had primary responsibility for the transaction at the time that a previously issued document was issued, the previously issued document is not required to be reissued merely to change a loan originator name and NMLSR ID.August 5, 2013 at 4:14 pm #3769tstraitParticipant
Thanks, Robin. I spoke with my primary regulator, and he agreed.
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