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New law for Maryland loan originators

Posted on: 28th Dec, 2006 08:41 pm
There's some news for all lenders at Maryland.

From January 1, 2007, home loan originators in the state must have license if they are to work with mortgage brokers.

The loan originators need to submit an application. Authorities will check if the originators have had criminal background.

The authorities will check if the originators are in business for less than 3 years. They also need to go through a 40 hour course on regulations, ethics ands other trade information.

I think this new law will help to curb predatory lending in the state of Maryland.
It's a good move by state authorities. But originators working for banks and licensed mortgage brokers do not come under this law as they are regulated by the Old Line State's Department of labor, Licensing and Regulations (DLLR).

So, I doubt whether the law will at all be able to get rid of predatory lending on a large scale.
Posted on: 29th Dec, 2006 01:28 am
Hi Adonis,

In my opinion it would still be effective in regulating loan origination procedure in the state despite the fact that originators working for banks and licensed mortgage brokers will not be covered by this law as they are regulated by the DLLR.

I found some more information to what helping_user mentioned which I did like to share with you all.
  • This license will allow a loan officer to get employment under one lender only. Also such originator will be allowed to hold only one license.

  • As per the requirements of the new law the mortgage originator will have to send a written notification in advance to the commissioner about any change in his employer and get a amended license. For such modification a fee of $75 will have to be paid.

  • If a licensed mortgage lender does not have physical presence in Maryland then the mortgage originators working for him will not be able to obtain the mortgage originator license. It will only be possible if the lender gets an office in the state and employs at least one person who is eligible to originate mortgage loans as per the laws.
Colin
Posted on: 29th Dec, 2006 03:36 pm
I have heard that the brokers association in Maryland is getting very strict with the new law and may even punish those who violate the law.
Posted on: 02nd Jan, 2007 04:16 am
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