What are the benefits of the NMLS?
What are the benefits of the NMLS? There are many.
First, all state mortgage regulators have access to one uniform set of data for any given mortgage company and the individuals associated with it. Now, there is no way for a “bad apple” in the industry to skip town and attempt to get licensed in a new state without being detected. Second, it streamlines the mortgage licensing process for mortgage companies throughout the country.
In addition to the standardized “MU” forms required for registration in the NMLS, each state will also have its own specific set of requirements such as fingerprint cards, bonding, financial statement formats, net worth, mortgage industry experience, pre-licensing education, pre-licensing testing, in-state offices, loan officer licensing, continuing education, dual employment restrictions, compensation format requirements, etc. These additional requirements will all have to be satisfied in order to be licensed in any particular state.
The NMLS only provides company users with a list of state-specific documents that must be submitted as part of the mortgage licensure process in any given state. The NMLS does not provide any information relating to state licensing laws. Given this, ALL mortgage companies MUST read and understand state mortgage licensing statutes and administrative rules PRIOR to starting the mortgage licensing process in any state. Not doing so will either lead to very expensive mistakes or substantial delays in licensing. Remember, state regulators still make the licensing decision! Keep in mind, the NMLS is not a regulatory body! It is only a central repository of licensing information. All licensing decisions will continue to be made by individual state mortgage regulatory agencies. For more information about the NMLS, pre-licensing and continuing education courses, visit www.mortgagetrainingconcepts.com.