Richardville legislation requiring mortgage loan officer registration passes Senate
The Senate today passed legislation that will help address some problems within the mortgage industry by individually registering loan officers, said Sen. Randy Richardville, sponsor of the reform plan.
"The main goal of this legislative package is to help make individual mortgage loan officers more accountable and responsible when brokering or originating loans in Michigan," said Richardville, R-Monroe. "Homeowners, who are currently facing many problems such as rising foreclosure rates, must be reassured that their mortgage loan officer is qualified to conduct loan transactions."
The proposal seeks to ensure responsibility through accountability by requiring mortgage loan officers to register with the Office of Financial and Insurance Services.
Senate Bill 826, sponsored by Richardville, will create a seven-member Mortgage Industry Advisory Board. The board will make recommendations to the OFIS commissioner on loan officer educational courses, requirements and procedures and will review policies for the loan officer registration process.
The legislative package will also:
Prohibit a mortgage broker or lender from paying a commission to unregistered loan officers;
Establish educational and application requirements for becoming a registered loan officer;
Develop standards for the registration renewal process, including continuing education;
Require employers to conduct a criminal records check on mortgage loan officers;
Specify prohibited loan officer conduct;
Set penalties for loan officers who violate the law; and
Encourage the OFIS to continue its participation in the states-based development of the Nationwide Mortgage Licensing System.
"Registering mortgage loan officers in Michigan complements other efforts that have been taken at the federal and state level to curb fraud and reduce foreclosures," Richardville said. "This legislation provides consumers further protection from unscrupulous mortgage loan officers and allows us to keep track of bad actors who move from state to state."
Senate Bills 826-833 and Senate Resolution 119 will now advance to the House for consideration.
Posted: Tuesday, November 06, 2007
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