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Important Notice to TACDC Members:
New Licensing Requirements for Nonprofits and Municipalities
The ''S.A.F.E.
Mortgage Licensing Act of 2008” establishes new licensing requirements
for many people who process home mortgage loans. In Texas,
House Bill 10 from the last legislative session makes Texas compliant with the
SAFE Mortgage Licensing Act of 2008. This will, for the first time, include
non-profits and municipalities which issue or process down
payment assistance loans, mortgage notes, remodeling / renovation loans, or any
other form of interest bearing instrument that is tied to a person's residence.
(For more information, including links to the regulation, state and national
resources,
click here.)
The new law
impacts persons who serve as lending processors (loan officers / intake
specialists / related assistants) who must now take 20 Hours of Approved
Pre-Licensing Training
and pass national
and state exams by April 2, 2010
or will be unable to do
business after that date. TACDC is working with the Texas Department of Savings
and Mortgage Lending to help identify persons who are impacted by this change in
the law.
The April 2
deadline makes time of the essence, so TACDC is working to provide our member
Community Development Corporations and their affected personnel access to
approved training that will meet the new requirements. To determine if the new
law impacts your organization and personnel, or partner organizations, please go
through the checklist below. If it appears that you are affected, please
respond to the very brief survey so that we can find the best way to help you
meet your licensing requirements. If you know someone else that may be impacted
by this new requirement, feel free to forward this email to them.
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DOES THIS AFFECT YOU?
If you answer yes to any
of the following questions, you will need to be licensed:
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Do any
of your employees offer mortgage products, terms, or interest rates
to clients?
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Do any
of your employees underwrite and approve residential loans?
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Do any
of your employees work as a contractor or agent for another company
offering mortgage products, terms, or interest rates or processing,
underwriting, or approving loans?
If
you answered yes to ANY of these questions and are not a regulated
financial
institution (bank, credit union, etc.) Click
here
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ATTENTION FORECLOSURE COUNSELORS AND GOVERNMENTAL ENTITIES:
Below are the answers to two questions from the Texas Department
of Savings and Mortgage Lending:
Q: Are Foreclosure Counselors subject to the licensing
requirements under the SAFE Mortgage Licensing Act? These Foreclosure
Counselors are providing education and advice, however, they are also
representing the interest of their clients to the lender to reset/recast/ or
issue new loans with better terms. These counselors are discussing and
negotiating terms on behalf of the borrower, however, they are not being
reimbursed or funded by the lender. The counselors might be paid for their
services through the 'Homeownership Preservation Foundation' - a 501(c) (3)
nonprofit which creates partnerships with local governments, nonprofit
organizations, borrowers and lenders.
A: Yes, based on the activities you describe. There is
"compensation or gain" from the non-profit as required in the definition of a
residential mortgage loan origination in Chapter 180.002(19) (A) and they are
"negotiating terms", which kicks them into Chapter 180.002(19)(A)(ii).
Q: If a Municipality or non-profit is issuing a GRANT (no
limitations or liens), are they subject to the licensing requirements of the
SAFE Mortgage Licensing Act?
A: We have heard from municipalities regarding their issuance of
down payment assistance loans that do place a lien on the property. We have
advised them that this activity would require a license. In your scenario, if
the GRANT has interest that is discussed with the client and terms and
conditions are discussed, along with credit advice, then it would also require a
license. If a GRANT is somehow issued without discussion, no terms, etc.., then
no license would be required but we do not understand how that could occur.
UPDATE FROM Texas Department of Savings and Mortgage Lending:
Certain HUD-Approved Housing Counselors Not Subject to Registration and
Licensing Under NMLS and Texas SML
Members of the Texas Foreclosure Prevention Task Force (TFPTF) met recently with
Texas Department of Savings and Mortgage Lending Commissioner Douglas Foster,
Director of Licensing Sandra Weller, and General Counsel Caroline Jones, to
discuss the registration and licensing requirements for HUD-Approved Housing
Counselors under the Nationwide Mortgage Licensing System (NMLS) and the Texas
Savings and Mortgage Lending (SML).
Commissioner Foster understands the critical work of the housing counselors in
Texas and indicated that certain counselors would not be subject to registration
and licensing under NMLS or Texas SML.
Specifically, counselors who are an employee of a 501(c)(3) HUD-Approved Housing
Counseling Agency when engaged in activities (outlined in 24 CFR § 214) such as
foreclosure prevention counseling, pre-purchase counseling, and reverse mortgage
counseling, but not engaged in originating loans or the decision making process
of loan organization are NOT subject to registration and licensing.
See detailed description here for those NOT required to have this license:
http://mortgage.nationwidelicensingsystem.org/slr/PublishedStateDocuments/TX-SML-Auxiliary-RMLO-Desciption.pdf
The following information is further detailed on the NMLS Resource Center
website here:
http://mortgage.nationwidelicensingsystem.org/Pages/default.aspx
click on the blue map and select TX SML.
See also
License
Descriptions and Checklists
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TO REGISTER FOR YOUR NMLS 20-HOUR
APPROVED TRAINING
CLICK
HERE
TO REGISTER CONVENIENTLY ONLINE
OR
CLICK HERE
TO REGISTER BY PHONE, MAIL, OR FAX
YOU MUST HAVE YOUR NMLS UNIQUE IDENTIFIER NUMBER TO REGISTER AND TAKE
THE COURSE - for more information,
click here. |
Below
are links to additional information on the SAFE Mortgage Licensing Act
TDSML
– Texas Department of Savings and Mortgage Lending
http://www.sml.state.tx.us/index.html
- Texas SML Home: Agency
News and Important Updates
http://www.sml.state.tx.us/tdsml_important_information.html#safe_nmlsr
- Important Information
TACDC - SAFE Training and Information
http://www.tacdc.org/SAFE.htm
CSBS
– Conference of State Banking Supervisors
http://www.csbs.org//AM/Template.cfm?Section=Home
– CSBS Home Page
http://www.csbs.org/AM/Template.cfm?Section=SAFE_Act
- SAFE Mortgage Licensing Info & Links page
http://www.csbs.org/AM/Template.cfm?Section=Mortgage_Licensing
– Info/Link:
Nationwide
Licensing System
HUD
– US Department of Housing and Urban Development
http://www.hud.gov/offices/hsg/ramh/safe/smlicact.cfm
- HUD ‘About the Act’ page
http://www.hud.gov/offices/hsg/ramh/safe/sfea.cfm
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HUD Links page:
SAFE Mortgage Licensing Act
http://www.hud.gov/offices/hsg/ramh/safe/safeact1.pdf
- TITLE V - S.A.F.E. Mortgage Licensing Act
http://www.hud.gov/offices/hsg/ramh/safe/modellaw.pdf
- STATE MODEL LANGUAGE FOR IMPLEMENTATION OF PUBLIC LAW
http://www.hud.gov/offices/hsg/ramh/safe/safecon709.pdf
- HUD SAFE Report to Congress, July 2009
NMLS
- Nationwide Mortgage Licensing System
http://www.stateregulatoryregistry.org/NMLS/AM/Template.cfm?Section=Home3
- NMLS Resource Center
AARMR
- American Association of Residential Mortgage Regulators
http://www.aarmr.org/
- Association Home Page
If
you have any questions about this information, the survey, or the SAFE Mortgage
Licensing Act,
contact Eduardo Magaloni at (512) 916-0508 or
eduardo@tacdc.org.
TACDC in Partnership
with Power Training approved NMLS Provider #1400059
Power Training, Inc.
8000 Anderson Square, Suite #103
Austin, Texas 78757
512-451-9112
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