FHFA announces new mortgage data requirementsMortgagePress.comFannie Mae, Freddie Mac, James Lockhart, FHFA, Housing and Economic Recovery Act of 2008, Nationwide Mortgage Licensing System
James B. Lockhart, Director of the Federal Housing Finance
Agency, has announced that, effective with mortgage applications
taken on or after Jan. 1, 2010, Freddie Mac and Fannie Mae are
required to obtain loan-level identifiers for the loan originator,
loan origination company, field appraiser and supervisory
appraiser. Director Lockhart communicated this requirement to
Fannie Mae CEO Herbert Allison and Freddie Mac CEO David Moffett in
letters dated Oct. 8, 2008.
FHFAs requirement is consistent with Title V of the Housing and
Economic Recovery Act of 2008, the S.A.F.E. Mortgage Licensing Act,
enacted July 30. With that Act, Congress required the creation of a
Nationwide Mortgage Licensing System and Registry. In prior years,
both Enterprises worked with the Mortgage Bankers Association of
America (MBAA) and the National Association of Mortgage Brokers
(NAMB) on a similar initiative. However, that effort was thwarted
due to the absence of a national registration and identification
system. With enactment of the S.A.F.E. Mortgage Licensing Act,
identifiers will now be available for each individual loan
originator.
"This represents a major industry change. Requiring identifiers
allows the Enterprises to identify loan originators and appraisers
at the loan-level, and to monitor performance and trends of their
loans," said Lockhart. "If originators or appraisers have
contributed to the incidences of mortgage fraud, these identifiers
allow the Enterprises to get to the root of the problem and address
the issues."
The purpose of FHFA's requirement is to prevent fraud and
predatory lending, to ensure mortgages owned and guaranteed by the
Enterprises are originated by individuals who have complied with
applicable licensing and education requirements under the S.A.F.E.
Mortgage Licensing Act, and to restore confidence and transparency
in the credit markets. In addition, the Enterprises will use the
data collected to identify, measure, monitor and control risks
associated with originators and appraisers performance, negligence
and fraud.
A licensing system owned and operated by State Regulatory
Registry LLC will be used to license and register loan originators.
The Conference of State Bank Supervisors (CSBS) in cooperation with
the American Association of Residential Mortgage Regulators (AARMR)
established the State Regulatory Registry LLC (SRR) in 2006 with
the intent of creating a National Mortgage Licensing System. The
system is intended to enhance each states ability to protect
consumers; improve supervision and enforcement of licensed
entities; and streamline licensing and other processes for state
agencies and the industry through the use of modern technology and
centralizing redundant state agency operations.
To implement the requirement, FHFA has been working with the
Conference of State Bank Supervisors (CSBS) and the FFIEC Appraisal
Subcommittee. Within the next 30 days, both Fannie Mae and Freddie
Mac will be issuing guidance related to implementation of the
requirement.
Letter
to Fannie Mae
Letter to
Freddie Mac
HR
3221, Title V, the SAFE Mortgage Licensing Act
National Mortgage Licensing System (NMLS)
Conference
of State Bank Supervisors (CSBS)
For more information, visit www.fhfb.gov.
