Wednesday, April 21, 2010

S.A.F.E. Act - Are Your Ready?

While most Banking Departments in the past have required some form of loan originator licensing, it was haphazard and inconsistent across the board. The need to regulate loan officers and make them accountable for their own actions on a loan level basis was the crux of Title V of the Housing and Economic Recovery Act of 2008, also know as the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (S.A.F.E. Mortgage Licensing Act of 2008). The act established national standards for mortgage licensing and training – both pre-licensing and continuing education.

Unless you fall into an “exemption”, all companies as well as originators must comply with the S.A.F.E Act and all its requirements before fast approaching deadlines. Most states have set licensing compliance deadlines of May 31, July 31, October 31 or December 31, 2010.

Banking Departments have hired teams of employees for the sole purpose of calling borrowers to verify who the loan originator was. With states running such large deficits, what easier way to levy fines and bring in some money. Do not let the deadlines pass you by.

WARNING: If you're licensed in numerous states and employ numerous originators, this can be a terribly expensive proposition. The time and costs of both training and the exams themselves will quickly multiply. I'm sure most cannot afford to overpay nor can they risk losing talented originators. Do you have a plan???