Senate approves mortgage loan officer licensing requirements to comply with federal law

LANSING, MI – June 26, 2009 – (RealEstateRama) — The Senate today unanimously approved bipartisan legislation that would strengthen existing requirements for loan officers in Michigan, said Sen. Randy Richardville, chair of the Senate Banking and Financial Institutions Committee.

“Michigan enacted its own mortgage loan officer registration requirements last legislative session through measures that I sponsored,” said Richardville, R-Monroe. “The bills we passed today strengthen our existing laws by including other protective measures recently passed by the federal government.”

Michigan’s “Mortgage Loan Originator Licensing Act,” sponsored by Richardville, would add new federal requirements to those already established in Michigan law for individuals who offer or negotiate terms for a mortgage loan. The requirements include pre-licensing education and testing, as well as fingerprinting and background checks under the national Secure and Fair Enforcement Mortgage Licensing Act of 2008. Loan originators would also be required to register through the Nationwide Mortgage Licensing System and Registry.

“The registry will help ensure that loan officers are acting in the best interest of consumers and provide homeowners with easy access to a loan officer’s employment history,” Richardville said. “By providing uniform education and licensing standards, we will improve accountability and track loan officers regardless of what state they are actually working in.”

Michigan must adopt this legislation by July 30, 2009 to comply with federal law. Mortgage loan originators must be licensed under the new system by July 31, 2010.

Senate Bills 462 through 465 now advance to the state House for consideration.