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Does a person engaged in loss mitigation or loan modification activities have to obtain a mortgage loan originator license?

April 26, 2017activities engaged license loan modification loss mitigation mortgage loan obtain Originator person

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Does a person engaged in loss mitigation or loan modification activities have to obtain a mortgage loan originator license?

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A. Under both Chapter 255F and the federal S.A.F.E. Act, the definition of a mortgage loan originator is very broad and includes anyone who, for compensation or gain, “(i) takes a residential mortgage loan application; or (ii) offers or negotiates terms of a residential mortgage loan”, regardless or whether the offer or negotiation involves a new mortgage or is concerning an existing mortgage. However, given the current economic environment and the public policy goal to encourage as many responsible loan modifications as possible, the Conference of State Bank Supervisors has requested that HUD delay the effective date to license anyone involved in loan modifications who meets the definition of mortgage loan originator. The Division and the NMLS will post information on their websites when HUD responds to the request. See HUD’s FAQs, Question 5 for additional information.