Small Credit Union Conference Compliance Q&A

S.A.F.E. Act Q. Is there a cost to register loan originators on the Nationwide Mortgage Licensing system?

A. Yes. Here is the information regarding fees from the NCUA:

The SAFE Act addresses fees as follows:

SEC. 1510. FEES. The [Agencies], the [HUD] Secretary, and the Nationwide Mortgage Licensing System and Registry may charge reasonable fees to cover the costs of maintaining and providing access to information from the Nationwide Mortgage Licensing System and Registry, to the extent that such fees are not charged to consumers for access to such system and registry.

The Agencies are contracting with the State Regulatory Registry LLC (SRR) to administer the Registry and establish the related fee structure. As such, the SRR will be determining the nature and amount of any federal registration fees and will assess depository institutions in connection with SAFE Act federal registration. The Agencies themselves, including NCUA, do not anticipate assessing any SAFE Act federal registration fees from their regulated entities.

The Conference of State Bank Supervisors (CSBS) has indicated there will be an opportunity for the public to comment on the fees, and any future adjustments to such fees, before their imposition on federal registrants and their employing institutions. We anticipate SRR will announce the fee structure prior to the Registry’s availability for online registration. NCUA will strive to ensure those fees are reasonable.

Q. Is there an exemption for NMLS registration?

A. Yes. The regulation has a “de minimus” exception. Registration requirements do not apply to any employee of a credit union who has never been registered or licensed through the Registry as an MLO if during the past 12 months the employee acted as an MLO for five or fewer residential mortgage loans.

Risk Based Pricing Notice Q. When does the Risk Based Pricing Notice have to be given to the member?

A. It varies:

 For close-end credit: before consummation  For open-end credit: before the first transaction

 For interest rate increases on existing loan: at the time of the increase

Q. Who provides the graph seen in model notice H–3 (Model form for credit score disclosure exception for credit secured by one to four units of residential real property) and how often does it need to be updated?

A. Remember, this notice is NOT the risk-based pricing notice. It is the standard notice you will give to ALL members in lieu of providing a risk based pricing notice to only certain members. The graph should be supplied to you by the consumer reporting agency that provided the credit score. The CRA will update the graph as the data changes. There is no other timing requirement for update of the graph.

Mortgage Loan Transfer Notification Q. How is this notice provided with loan participations or mortgage backed securities?

A. The new disclosure requirement applies to any person or entity that acquires ownership of an existing mortgage, whether the acquisition occurs as a result of a purchase or other transfer or assignment. A person is covered by the rules if it acquires legal title to the debit obligation.

An exception to the notice requirements applies when the covered person acquires only a partial interest in the loan and the party authorized to resolve issues concerning the consumer’s payments on the loan does not change.

MDIA Disclosures Q. Are the MDIA disclosure part of the Truth-in-Lending statement, or are they separate?

A. The MDIA disclosures will be part of the Truth-in-Lending statement.