FAQ for Maryland NMLS Transition
FREQUENTLY ASKED QUESTIONS AND ANSWERS REGARDING MARYLAND NMLS TRANSITION FOR YOUR ASSISTANCE
As you know, Maryland’s transition to the Nationwide Mortgage Licensing System is under way. Your continued cooperation in this transition is greatly appreciated. To assist licensees and applicants, we have prepared a list of “Frequently Asked Questions” and the appropriate answers. The list has been prepared based on initial questions that we have been receiving. We hope that it will be helpful in smoothing this process.
The FAQ list will be added to the list of resources for your assistance that are posted on the website of the Office of the Commissioner for Financial Regulation. You may also consult the website for additional information including:
The Maryland Transition Plan on NMLS;
Powerpoint Maryland Transition Briefing; and
One page Desktop Summaries for Mortgage Lenders and Mortgage Loan Originators
1. I have a Maryland Mortgage Lender or Mortgage Loan Originator license. When do I need to get licensed through NMLS?
Maryland is currently in an 18-month transition period for Mortgage Lender and Mortgage Loan Originator licensees. If your license expires between July 1, 2009 and December 31, 2010, you will need to transition to NMLS PRIOR TO THE EXPIRATION OF YOUR CURRENT LICENSE. Follow the process detailed in the Maryland Transition Plan (on the NMLS website) in order to transition your license and obtain a new license that will expire on December 31, 2010. Your licensing fee will be pro-rated for the period beginning on the date your renewal license term begins and December 31, 2010 when it expires. You will only be charged for this period.
2. My Maryland Mortgage Loan Originator or Mortgage Lender license will not expire for some time. Do I have to wait until immediately before my license expires to transition/renew through the NMLS?
No. While current licensees must transition to and renew their licenses through the NMLS prior to expiration, you are free to transition/renew at any time in advance of expiration. As noted above, if your current license expires between July 1, 2009 and December 31, 2010, your renewal license term will expire on December 31, 2010 and you will be charged a pro-rated fee based on the length of that term.
3. I don’t have a Mortgage Lender or Mortgage Loan Originator license, but I want to obtain a license. Must I go through NMLS to submit my Maryland application to the Office of the Commissioner of Financial Regulation?
Yes. Applications for new Maryland Mortgage Lender or Mortgage Loan Originator licenses must be initiated through the NMLS website. You must be licensed before originating Maryland mortgage loans or engaging in the “mortgage lending business” (making, brokering or servicing Maryland mortgage loans). If you were previously exempt from licensing as a Mortgage Loan Originator under Maryland law, your exemption has likely been eliminated as of July 1, 2009 and you need to be licensed. Individuals previously exempt from licensing include owners of Maryland Mortgage Lender licensees and employees of licensed Maryland Mortgage Lenders that did not broker loans.
If you were previously exempt from Mortgage Loan Originator licensing, you may be eligible for an Interim Mortgage Loan Originator license—but you must apply for an Interim Mortgage Loan Originator License no later than July 31, 2009. This Interim Mortgage Loan Originator license will allow you to continue to operate, subject to the same limitations as you were under through your prior exemption, while you complete certain licensing requirements (pre-licensing education, testing, criminal background check). You must complete these requirements by July 31, 2010 or your license will be revoked. See the New Application Checklist for Maryland Mortgage Loan Originators for more details.
4. Where are the locations that applicants may get their fingerprints processed electronically?
Fingerprinting processes through the NMLS have not yet been implemented. Details on fingerprinting locations and processes for Maryland are available on the Maryland website.
5. Can I do an interim change/amendment at the same time I apply for a license renewal through the NMLS?
No. Your information must be up to date with the Office of the Commissioner at the time you apply for the renewal of a license and transition to the NMLS. If you need to change your information, we encourage you to update your information with our office at least 90 days prior to your renewal/transition so at the time of renewal/transition there will be no pending changes to submit. Additionally, after completing your renewal/transition you will be able to execute any interim changes/amendments through the NMLS.
MORTGAGE LOAN ORIGINATORS
6. I own 25% or more of my company and we have a Mortgage Lender license. Do I need a Mortgage Loan Originator license? If so, when do I have to fulfill the pre-licensing requirements?
Yes. The previous exemption from Mortgage Loan Originator licensing for owners of 25% or more of Maryland Mortgage Lender licensees has been eliminated. All such previously exempt individuals acting as Mortgage Loan Originators must be licensed as Mortgage Loan Originators no later than July 1, 2009. NOTE: These previously exempt individuals may apply for an Interim Mortgage Loan Originator license as described above. For additional information on Interim Mortgage Loan Originator licenses for the previously exempt, see FAQs below.
7. I am applying for a Mortgage Loan Originator license. Am I subject to a surety bond requirement?
Yes. Mortgage Loan Originators are now subject to a surety bond requirement, but this may be met at the company level by the originator’s employer/NMLS sponsor. Consequently, an originator may meet the surety bond requirement by being covered by his or her employer’s surety bond (provided the employer’s bond complies with the surety bond rules established for Maryland Mortgage Lender licensees). See the Maryland checklist for your application on the NMLS website for more information.
8. What is the fee for a Mortgage Loan Originator license?
The license fee is $225 per year, plus a non-refundable $100 investigation fee for a new license. The NMLS processing fee is $30 per year.
9. Must I submit information that is in addition to that required by the MU Forms?
Yes. Please refer to the Maryland checklist for your application on the NMLS website for all additional items which you must send to the Office of the Commissioner of Financial Regulation. Key additional items include the affidavit of Maryland Mortgage Originator Activity, the Employment Statement and the Credit Report authorization.
10. Does Maryland have a net worth requirement for Mortgage Loan Originators?
No. Maryland does not have a Mortgage Loan Originator minimum net worth requirement. Only Mortgage Lender licensees are subject to a minimum net worth requirement.
11. If I don’t originate any loans, do I need to get a Mortgage Loan Originator license? All I do is own a part of a Mortgage Lender licensee and we employ loan officers to do all of the originations.
No. You do not need a Mortgage Loan Originator license merely because you own part or all of a Mortgage Lender licensee if you do not originate loans.
12. The online application states that I need to submit a letter from my employer explaining what company I will originate for. I am a broker with a one-man shop, I don’t have any employees. Do I have to provide such a letter and if so what should it say?
Yes. Even if you are a sole proprietor or the only employee for your company, you must provide a letter identifying who you will originate mortgage loans for. In such a case, you should simply state in the letter that you are working for yourself, if a sole proprietor, or if you are the sole owner of a corporate or LLC licensee, state that you are the only employee for the company.
13. I had a criminal background check completed when I applied for my Mortgage Lender license. Although previously exempt from licensing, I need to get my Mortgage Loan Originator license under the new law. May I use my previous background check in connection with my application?
No. Certain standards for Mortgage Loan Originator licensing have been raised by federal law, particularly those relating to felony convictions. As your previous background check was done against lower standards, it cannot be used for your new application. However, in recognition of this prior criminal check and to facilitate an orderly transition to the NMLS, subject to the Interim Mortgage Loan Originator licensing requirements you may defer completion of your fingerprinting/background check until July 31, 2010.
14. How long is it taking to process a new Mortgage Loan Originator application?
The average time to complete the processing of an application is between 30 and 60 days and is dependant upon how quickly we receive all required items from you.
15. The Mortgage Loan Originator application requires the submission of an affidavit concerning past mortgage origination activity. Where the applicant was not licensed or exempt from licensing as a Mortgage Loan Originator when originating Maryland mortgage loans, the affidavit requires a list of all Maryland mortgage loans originated by the applicant in the past twelve months, including the total number of loans, name and address of the company for which the loan was originated, the name and address of each borrower, the date each loan was originated, and the date each loan closed. That could be a very long list. If I was not licensed or exempt from licensing when I originated Maryland mortgage loans in the last twelve months, may I provide an explanatory paragraph rather than the requested list of information?
No. If you originated Maryland mortgage loans in the past twelve months while licensed or while subject to an exemption from licensing, you need not provide the list of loan information. If you otherwise originated Maryland mortgage loans during this time, you must submit the complete list of loan information required.
16. I originate for a bank – do I need a Mortgage Loan Originator license?
No. If you are employed by a bank or bank subsidiary, you will be registered through the federal bank regulatory agencies. However, if you work for a subsidiary of a bank holding company or an affiliate of a bank or bank holding company, you will need to be licensed as a Mortgage Loan originator.
MORTGAGE LOAN ORIGINATORS – PREVIOUSLY EXEMPT
17. I own 25% or more of my company and we have a Mortgage Lender license. I do not originate loans myself, but rather have one or more employees (licensed as Mortgage Loan Originators) who originate mortgage loans. Do I now need a Mortgage Loan Originator license?
No. You do not need a Mortgage Loan Originator license for your own company if you do not originate mortgage loans.
18. I own a company that is a Mortgage Lender licensee, but I also have a Mortgage Loan Originator license through another company. Do I need to switch my Mortgage Loan Originator license to my own company or may I keep it where it is as long as I don’t originate any loans for the company I own?
As noted above, you do not need a Mortgage Loan Originator license for your own company if you are not originating loans for your company. You may be a licensed Mortgage Loan Originator for a different company provided you are not a licensed Originator for your company. The key is that you can only be a licensed Mortgage Loan Originator for ONE company.
19. I have had a Mortgage Lender license for years, but now need a Mortgage Loan Originator license as my exemption has been eliminated. Am I considered a new licensee or a renewing licensee?
You are a NEW licensee. However, provided you apply on or before July 31, 2009, you are eligible for an INTERIM Mortgage Loan Originator license. As noted above, this Interim Originator status will allow you to continue to operate, subject to the same limitations as you were under through your prior exemption, while you complete certain licensing requirements (pre-licensing education, testing, criminal background check). You must complete these requirements by July 31, 2010 or your license will be revoked. See the New Application Checklist for Maryland Mortgage Loan Originators for more details.
20. I am employed as a loan originator for a bank. Do I need to get a Maryland Loan Originator license?
If you are employed by a bank or bank subsidiary, you will be registered through the federal bank regulatory agencies. However, if you work for a subsidiary of a bank holding company or an affiliate of a bank or bank holding company, you will need to be licensed as a loan originator.
MORTGAGE LENDERS – GENERAL
21. I am already on the NMLS, as is my corporate office, but my corporate office is not licensed in Maryland. Do I need to license the corporate office with the Office of the Commissioner and bring on other offices as branches?
Yes. The NMLS is structured so that a Mortgage Lender may have only one corporate office subject to a Form MU1 filing. Moreover, the corporate office subject to the Form MU1 filing must be in the NMLS for a state before the NMLS system will accommodate the filing of an application for a branch location in the state subject to a Form MU3 filing. Therefore, your corporate office will need to be licensed as a Maryland Mortgage Lender before your branches can be licensed through NMLS using Form MU3.
22. My branch license is expiring but my corporate office license is not. May I transition/renew only the expiring branch on the NMLS?
No. For each transitioning branch renewing in Maryland, a Form MU3 must be filed through NMLS. However, as described in FAQ 22 above, the NMLS will NOT accommodate the filing of branch location Form MU3 in a state without a Form MU1 for its associated corporate office for that state having already been entered into the NMLS. Therefore, the corporate office must complete Form MU1 and transition early (via renewal) to NMLS BEFORE a branch office can transition. Upon transition, the current Mortgage Lender license for the corporate office will be extended to the December 31, 2010 expiration pursuant to the normal renewal process and a pro-rated fee will be charged for the additional period.