Mortgage Loan Originators (a/k/a MLOs)
General Information
A ‘‘mortgage loan originator’’ is “an individual who for compensation or gain or in the expectation of compensation or gain takes a residential mortgage loan application or offers or negotiates terms of a residential mortgage loan…” O.C.G.A. 7-1-1000(22); see also 12 U.S.C. § 5102(4). Mortgage lenders, mortgage brokers, banks, and credit unions employ mortgage loan originators to take mortgage applications and offer/negotiate terms of mortgage loans. If you have obtained a mortgage loan, you have interacted with at least one mortgage loan originator.
Under the federal Secure and Fair Enforcement of Mortgage Licensing (“SAFE”) Act, mortgage loan originators are required to be either licensed by state regulators (such as the Department) or federally registered with the appropriate federal regulator. Mortgage loan originators who work for state licensed mortgage lenders or mortgage brokers must be licensed by the state regulator prior to originating any loans in the state. Mortgage loan originators who work for banks or credit unions must be federally registered.
Under the SAFE Act and the Georgia Residential Mortgage Act (“GRMA”), the Department licenses mortgage loan originators who operate in Georgia and are employed by a Georgia licensed mortgage broker or mortgage lender. All regulators (including federal regulators and state regulators, like the Department) use the Nationwide Multistate Licensing System and Registry (“NMLS”) to manage mortgage loan originator licensing, registration, and authorization.
Temporary Authority to Operate
In November 2019, a new federal law went into effect that grants a mortgage loan originator “temporary authority to operate” in certain states for up to 120 days while the originator’s license application is pending in the state. 12 U.S.C. § 5117. The mortgage loan originator must have been previously licensed by another state or registered with a federal regulator to qualify for temporary authority. Additionally, the mortgage loan originator must meet certain criteria established by federal law in order to exercise temporary authority, including but not limited to employment and sponsorship by a mortgage lender or mortgage broker in the state.
To keep temporary authority to operate in Georgia, the mortgage loan originator must provide a complete license application and supporting documentation to the Department. Failure to provide any requested documentation puts the mortgage loan originator at risk of losing his or her temporary authority to operate in the state.
If the mortgage loan originator loses his or her temporary authority to operate in Georgia for any reason, the MLO cannot perform work on any Georgia mortgage loans unless and until his or her license application is approved by the Department. The individual mortgage loan originator and the mortgage lender or mortgage broker that employs the mortgage loan originator are responsible for keeping track of the mortgage loan originator’s temporary authority to operate status. The Department will communicate this status directly to the mortgage loan originator and through NMLS.
Work performed by a mortgage loan originator while validly operating under temporary authority should be honored by the mortgage lender or mortgage broker that employed the mortgage loan originator. This is true even if the mortgage loan originator is not ultimately licensed by the Department after validly exercising temporary authority or if the mortgage loan originator loses his or her temporary authority status in Georgia. If you have questions or concerns regarding your originator’s license status in Georgia, you should contact your broker or lender directly.
NMLS Consumer Access provides information regarding a mortgage loan originator’s license status and authorization to operate in Georgia, as well as any final administrative actions. www.nmlsconsumeraccess.com