New Jersey Lender Licensing Change Effective 2010.

NJ Mortgage License Requirements

As you may be aware, Governor Corrine has signed into law a bill that amends the Licensed Lender Act ( which we are currently licensed under) with the new Residential Mortgage Lending Act. This is New Jersey's regulatory change to comply with the requirements mandated by the federal Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act).

The Major Changes-

• All licensing will be done thru the NMLS
• The combining of First and Secondary Mortgage Lenders Licenses into one Lenders License
• Stricter enforcement and more substantial fines for violations of licensing guidelines
• Loan Originator Licensing with far more requirements and restrictions than the current Mortgage Solicitor Registration.

All Licensed Lenders will need to transition their current license onto the NMLS at some point between January 4^th 2010 and July 31^st 2010. In this transition, we will essentially be surrendering our Lenders License and receiving of the "New Residential Mortgage Lenders License". At that point, and not until, will we be subject to the provisions of the new law.

The most substantial difference will be for Loan Originators. There will no longer be Registered Mortgage Solicitors. Once the company transitions, all LO's will have to apply for and become Licensed Mortgage Loan Originators. Loan Originators will have to complete education, testing, fingerprint, background checks and submit credit reports. However, the state has not released specifics and there are unfortunately no mechanisms, approved courses, or application available for anyone to get started with as of yet.

A NJ Mortgage Loan Originator under the new law:

• Will be disqualified from licensure if:
  • Convicted of a felony during the seven year period before filing application
  • Convicted of a felony involving fraud, dishonesty, a breach of trust or money laundering at any prior time.

The state will require prior to application:

• 20 hours of continuing education
• A passing grade on a pre-licensing test
• Fingerprint Cards
• Background Check
• Credit Report ( Not set by state yet, but we expect they will require a minimum score somewhere around 600-620)

The time line for each step of the transition process is a bit up in the air at this time. However, we do know that the entire process, including all LO licensing, must be completed by July 31^st 2010.

There have been many changes in the Real Estate world in NJ, coming in 2011 we will be the last State in the country to require Continuing Ed for Real Estate Agents.

This will come up quick, 20 Hours of CE could be "fun" to try and accomplish in a short time frame especially since there is no

Rob

Robert Rauf

Mortgage Banker

www.RobertRaufHomeLoans.com or my blog: http://activerain.com/blogs/rrauf

(732)223-1630 x102

Since 1987 I have been helping my clients fulfill their dream of home ownership!

Real Estate Mortgage Network

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