Ready? Set? SAFE Act!

Question 1

What does the SAFE act stand for?

Answer 1

Secure and Fair Enforcement for Mortgage

Licensing Act

Question 2

What groups regulated mortgage licensees?

Answer 2

CFPB and the State Regulatory Commissions

Question 3

What does NMLS stand for?

Answer 3

Nationwide Multistate Licensing System

Question 4

What is the NMLS?

Answer 4

The NMLS is a mortgage licensing system developed and maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators. The NMLS facilitates the licensing and registering loan originators and serves as a centralized depository for records and information related to mortgage licensees.

Question 5

What are some charceteristics of the NMLS?

Answer 5

• Provides uniform license applications and reporting requirements for state-licensed loan originators
• Provides a comprehensive licensing and supervisory database
• Takes in and improves the flow of information to and between regulators
• Provides increased accountability and tracking of loan originators
• Streamlines the licensing process and reduces the regulatory burden
• Enhances consumer protections and supports anti-fraud measures
• Provides consumers with free, easily-accessible information via electronic media regarding the employment history of and disciplinary and enforcement actions against loan originators
• Establishes a means by which residential mortgage loan originators would, to the greatest extent possible, be required to act in the best interests of the consumer
• Facilitates responsible behavior in the subprime mortgage marketplace and provides comprehensive training and examination requirements related to subprime mortgage lending
• Facilitates the collection and disbursement of consumer complaints on behalf of state and federal mortgage regulators

Question 6

What regulation sets forth the rules to implement the SAFE Act and?

Answer 6

Regulation H

Question 7

What does Regulation H do?

Answer 7

• Sets forth the rules to implement the S.A.F.E. Act

- Sets forth the responsibilities of the NMLS

Question 8

What guidelines does the SAFE Act provide when licensing MLO’s?

Answer 8

• Setting education standards for pre-licensing education and continuing education
• Requirement for background checks

Question 9

What are state agencies and the CFPB authorized to in regard to MLOs?

Answer 9

• Investigate potential rule violations by licensees
• Impose discipline on licensees for violations of mortgage laws or rules (e.g., fines, license suspension, or revocation)
• Set licensing fees for both initial and renewal licenses