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o Register and maintain such registration, as either—
� A ―Registered loan originator‖ (defined as an individual who (1) is an
employee of a depository institution (or wholly owned subsidiary), and (2) is
registered and uniquely identified through the NMLSR), OR
� A ―State-licensed loan originator‖ (defined as an individual who (1) is a loan
originator not employed by a depository institution (or wholly owned
subsidiary), (2) is licensed by a State or the HUD Secretary, and (3) is
uniquely identified through the NMLSR).
STANDARDS FOR LICENSURE
State Licensing:
In order to be recognized as adequately meeting the requisites of this Bill, State licensing and
registration systems must participate with, and furnish information to, the NMLSR system. The
Bill sets forth the following minimum items of information that applicants must furnish,
including: applicant‘s identity, fingerprints for submission to FBI, and personal history
(including experience, credit report, and past criminal history).
Section 1505 of the Bill then defines the minimum standards allowable for licensing and
registration as a ―State-licensed loan originator.‖ Under such minimum standards, an applicant
must:
o Have no felony convictions in domestic, foreign, or military courts;
o Have no license revocation in any governmental jurisdiction;
o Demonstrate a record of financial responsibility and general fitness;
o Fulfill education requirements (20 hours of approved courses, to include at least 3
hours related to federal laws, 4 hours on ethics and consumer protection in mortgage
lending, and 2 hours on the sub-prime mortgage marketplace);
o Pass a written exam (the Bill sets forth detailed standards for the composition of such
exam, including minimum score of 75% required to pass, and retest criteria); and
o Meet net worth or surety bond requirements.
The Bill also sets forth the following minimum educational standards for State licensure
renewal—
o Satisfaction of annual continuing education requirements, including 8 hours of
approved education, and other items specified under the Bill;
o Continuous satisfaction of the minimum standards set forth above.
SYSTEM OF FEDERAL REGISTRATION:
Section 1507 of the Bill requires that the Federal Banking Agencies, jointly through the FFIEC
(and the Farm Credit Administration), develop and maintain a system for registering employees
of depository institutions, subsidiaries, or institutions regulated by the Farm Credit
Administration. This system is required to be fully implemented within one year of the Bill‘s
enactment. In that time frame, federal banking agencies would be ordered to register all
AMERICAN BANKERS ASSOCIATION 10