More states enact SAFE Act legislation

Louisiana, Missouri and New York are three of the latest states to enact legislation in compliance with the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (SAFE Act), which calls for states to establish a scheme for the licensing and supervision of individuals engaging in the business of mortgage loan origination. Louisiana HB 810, Missouri HB 382, and New York AB 6924 each require mortgage loan originators to, among other things, register with the Nationwide Mortgage Licensing System (NMLS), complete pre-licensing and continuing education, submit to fingerprinting for the purpose of a criminal history background check, and meet surety bond coverage requirements. Additionally, on June 30, Indiana Gov. Mitch Daniels signed into law HB 1001, an omnibus bill that permits the Indiana Department of Financial Institutions to adopt emergency regulations to implement the requirements of the SAFE Act; this provision of Indiana HB 1001 became effective July 1, 2009. Louisiana HB 810 becomes effective July 31, 2009; however, the new mortgage loan originator licensing provisions become effective July 31, 2010. Missouri HB 382 became effective July 8, 2009, and New York AB 6924 became effective July 11, 2009; the loan originator licensing provisions of both Acts do not become effective until at least July 31, 2010.