North Carolina Mortgage Servicer Licensing Requirements Effective January 1, 2009

North Carolina House Bill 2463 becomes effective on January 1, 2009. The legislation requires mortgage servicers to be licensed by the North Carolina Commissioner of Banks before acting as a mortgage servicer.

The bill also changes the brick and mortar requirements for mortgage brokers to specify that a mortgage broker’s physical location in North Carolina may not be a home or residence.

Tennessee Amends Mortgage Licensing Requirement

Tennessee Senate Bill 4160 became effective on January 1, 2009. Key points of the legislation included:

• New authorization for the Commissioner of Commerce and Insurance to require fingerprints from certain license and registration applicants;
  
• Amended initial education requirements for mortgage lender, mortgage broker, mortgage servicer, and mortgage loan originator license and registration applicants;
  
• New disclosure requirements for stockholders owning ten percent (10%) or more of outstanding capital stock; and
• Provisional authorization for mortgage loan originators to conduct business while awaiting registration approval from the Commissioner.

Michigan Extends Mortgage Loan Officer Registration Deadline

On December 18, the Governor of Michigan signed into law statutes amending the Mortgage Brokers, Lenders, and Servicers Licensing Act (MBLSLA). The law: (i) amends the effective date of mortgage loan officer registration requirements from January 1, 2009 to April 1, 2009; (ii) extends the deadline from December 3, 2008 to April 1, 2009 for an individual to obtain fingerprints and have an FBI and Michigan State Police criminal history check completed, pass the required Michigan mortgage loan officer examination, and submit the required Nationwide Mortgage Licensing System (NMLS) loan officer registration application and the Michigan specific loan officer application; (iii) extends the deadline from December 31, 2008 to March 31, 2009 for a residential mortgage originator and a loan officer to receive compensation for the origination of a mortgage loan; (iv) amends the MBLSLA and SMLA specifying that beginning January 1, 2009, the Michigan State Police and FBI may complete a mortgage loan officer criminal history check; (v) amends the SMLA to require fingerprints, a Michigan State Police and FBI criminal history check, pre-registration and continuing education, testing, and a secondary mortgage loan officer application if the loan officer is not registered as a loan officer under the MBLSLA and will originate for a mortgage broker, lender, or servicer that only brokers, makes, or services secondary mortgage loans.

Delaware Adopts Mortgage Loan Originator Regulations

Recently, the Delaware Office of the State Bank Commissioner issued regulations implementing a law requiring mortgage loan originators to be licensed. Among other things, the regulations provide that those mortgage loan originators employed by a licensed lender or mortgage loan broker prior to January 1, 2009 have until March 31, 2009 to submit a license application. Additionally, those individuals beginning employment as mortgage loan originators after January 1, 2009 may not conduct business as mortgage loan originators until they have submitted a license application. Once a license application has been submitted, an individual is free to operate as a mortgage loan originator on a provisional basis until the regulator has rendered a decision on the application. The regulations also set forth duties of originating entities that employ mortgage loan originators, as well as record keeping and notification requirements. Mortgage loan originators will be licensed through the Nationwide Mortgage Licensing System. The regulations became effective December 11, 2008.

What is the Best Way to Expand your Mortgage Company?

If you own your own mortgage company, you should always be looking at ways to expand your business. This does not necessarily mean that you want to hire more staff or make your company larger. Continually looking for ways to expand your business is required just to keep your income stable and to maintain the volume of business that is needed to stay in business.


So what are some of the best ways to expand your business?


Expand your coverage area (State Licensing)

Expand your available products (FHA Approval and Lender Approvals)

Expand your relationships (Realtors, CPAs, and Attorneys)

Expand your marketing (Online, Networking, and Lead Sources)



Expand Your Coverage Area (State Licensing)

One of the best ways to expand your business is to expand your coverage area. Most mortgage companies just rely on business in their home state. But when the market is slow in their state, they have no where else to turn. Also, when the type of marketing they are attempting to use does not produce a good response, they are forced to take the loss and look for other marketing routes. Any lead generation company will tell you that if you have multiple states to do business in, you will be better suited to meet these challenges.

State Licensing can be very complex, however, if you do your homework and choose a few good states, it will definitely be worth your while. Your mortgage company will be able to try different marketing in different areas of the country and be able to keep the volume high when the market in some states is slow.


Expand Your Available Products (FHA Approval and Lender Approvals)

Another great way to expand your business is to open up different loan products to your borrowers. Many borrowers shop around for a mortgage broker that can provide them with the best product to meet their needs. If you don\'t have access to most loan products in the market, you will lose the deal almost every time.

FHA is one of the most important loan products right now. It allows you to provide loans to low income, low credit score, high debt, and low asset borrowers, which is a majority of borrowers these days. In order to originate FHA loans, you need to be approved with HUD (Department of Housing and Urban Development).

Getting approved with other lenders is also a great way to expand your business. Not only should you be approved with 10 or more lenders, but you should know their guidelines like the back of your hand. Also, with so many lenders closing every day, you don\'t want to have all of your loans placed with one lender. That could be the end of your business very quickly.


Expand Your Relationships (Realtors, CPAs, and Attorneys)

Take the time to meet different people in other parts of the industry such as realtors, CPAs, escrow agents, title officers, and tax preparers. Often you can refer each other business. A common mistake is to think that people in these different areas of the business already refer business to other mortgage companies and don\'t need you. However, you would be surprised at how often I speak to a realtor that is having trouble with the mortgage company they refer their buyers to. They often can tell that I know the business and will ask me if I can do a loan for one of their buyers. Jump on these opportunities and actively seek other relationships. Knowing other people in the business is one of the best ways to create long lasting and profitable relationships.


Expand Your Marketing (Online, Networking, and Lead Sources)

A huge mistake that a lot of mortgage companies make is to only get leads from one source. If you market in only one way, that way is bound to dry up eventually. Make sure to have multiple lead sources in your business plan. Try marketing online or through another companies online system. Try networking through a website such as FaceBook or ActiveRain. Try getting leads from lead companies that actually do the marketing for you and send you the leads. As you try new ways of marketing, you will find what works best, but still continue to try new ways and keep a few lead sources in place.


Bottom Line

If you are not working at expanding your business, your business will shrink. And in todays market place, it will shrink fast.