MLO laws and regulations are contained in the California Mortgage Lending Act (CRMLA) and the California Finance Law (CFL).
A mortgage loan originator is an individual who accepts mortgage applications, or who proposes or negotiates the terms of a mortgage loan, for compensation or benefit, or with the expectation of compensation or benefit.
A mortgage is a residential property, including one to four housing units, that is secured by a mortgage, deed of trust, or other similar agreed security interest and is intended primarily for personal, family, or household use. means a loan against. Housing includes individual condominium units, corporate units, mobile homes, and trailers when used as a residence.
Who needs to obtain a Mortgage Originator License?
Anyone who originates a mortgage loan must apply for and obtain a mortgage originator license from the Department of Financial Protection and Innovation. All licenses are applied for and maintained through the Nationwide Multistate Licensing System and Registry (NMLS). Licenses must be renewed annually between November 1st and December 31st.
All MLOs employed by a financier/broker under the California Finance Law (CFL) or a mortgage lender/servicer under the California Mortgage Lending Act (CRMLA) must be licensed. MLOs may apply for a license by filing Form MU4 with the California Department of Financial Protection and Innovation (DFPI) through the National Multistate Licensing System and Registry (NMLS).
Mortgage loan originators do not include:
An individual who performs purely administrative or clerical functions on behalf of an individual who meets the definition of a mortgage loan originator. The term “administrative or administrative operations” refers to receiving, collecting, and distributing information common to the processing or underwriting of loans in the mortgage industry and communicating with consumers to obtain information necessary for the processing or underwriting of mortgage loans. means communication. However, such communications do not include offering or negotiating loan rates or terms or counseling consumers about mortgage rates or terms. An individual who merely renegotiates the terms of an existing mortgage loan held or provided by an employer and does not act as a mortgage loan originator unless the U.S. Department of Housing and Urban Development or a court of competent jurisdiction recognizes the application of SAFE. The law requires employees to be licensed as mortgage loan originators under state law implementing the SAFE Act. An individual involved solely in extending credit in connection with a timeshare plan. An individual licensed as a mortgage loan originator under the California Real Estate Code and the SAFE Act. A registered mortgage loan originator that is a depository institution, a subsidiary owned and controlled by a depository institution and regulated by a federal banking agency, or an employee of an institution regulated by the Farm Credit Bureau.
Exemptions for employees of bona fide nonprofit organizations:
Employees of bona fide nonprofit organizations may be exempt from licensure as mortgage loan originators if they meet certain annual requirements. For more information, visit Genuine Nonprofit Affordable Housing Organizations.
