Since I’ve covered Loan Originator licensing before on Rain City Guide, I thought I should provide this update. Apparently DFI is loosening up on their previous decision to not allow LOs to take loan applications if they did not submit the required information prior to the original January 31, 2006 deadline.
So if a Loan Originator did not follow the new simple rules before January 1, 2007, they can still practice business if they just complete DFI’s online application, the MU4 form and submit their fingerprints for the background check. As a Licensed Loan Originator who was able to take time out of my busy schedule to comply with DFI’s requirements, I’m just a little concerned and I hope this is not a trend.
Reversing the original decision doesn’t do anything to help the cause of bringing credibilty to the lending industry IMO. It seems that loosing the restrictions on LOs by the DFI would allow for more unlicensed professionals to enter the market without any accountability.
I wouldn’t say the original decision has been reversed. LOs (mortgage brokers) still need to become licensed and pass the exam (once it’s available). DFI is just not sticking by the original cut-off time of December 31, 2006 for LOs to submit their information for the background check and application.
Why enforce existing laws when you can legislate new ones? Look for the “Loan Originator Licensing Compliance Act of 2007” to come from your legislature in the summer.
Lending is about: (a) analyzing guidelines/rules (b) documenting a file properly (c) doing this in a timely manner to meet deadlines
What better test than the registration/licensing book to test those three skills? It seems that the non-compliant ones failed the first big test.
Exactly! You would think DFI would have kept with the original deadline of December 31, just to make processing the LO applications (who did comply) more streamlined for their staff. Instead of opening the floodgates to those who did not have their act together.