The Bank of Utah officials are now cautioning potential homebuyers and homeowners who want to refinance to check the license of their broker. Back in mid-December, the Utah Division of Real Estate sent a final alert to mortgage brokers to meet new federal SAFE Act requirements, which includes licensing with the federal Nationwide Mortgage Licensing System (NMLS) by year end. Brokers must also complete all testing and education requirements. Now that the deadline has passed, the NMLS data base is being compiled. However, it will be some time before consumers will have access to the database for mortgage companies. Access to banks and the federally insured are currently accessible.
In 2008, the SAFE Act was created to protect consumers from fraud. Standards were set for the licensing and registering of state licensed mortgage loans. The state of Utah was one of the first states in the nation to create a law that would enforce the federal mandate. But still, only 5,200 out of 9,200 mortgage brokers in Utah have changed over to the NMLS database. A low 2,000 of the 5,200 have completed all the requirements.
There are new concerns over unlicensed brokers that may continue to do business and violate the state law. Therefore, their license will be permanently revoked if they are caught. There has also been a considerable drop in the number of licensed independent mortgage brokers who can process loans, but that change will not affect mortgage loan originators or bank mortgage loan officers who work for federally insured depositories.
Dishonest lending practices of some brokers is the cause of the new SAFE Act regulations. The new system will assign a unique number to each licensed broker so their transactions can be tracked to help create a group of better qualified mortgage brokers. Home and commercial property buyers can protect themselves by dealing with licensed brokers only. You can go through a community bank to help assure that you are getting an experienced loan officer. If you’re not going through a bank, ask to see the broker’s current license.
Help keep yourself safe when by using the NMLS Consumer Access system or call 801-530-6747. When you’re making payments, only pay your service provider. You can also file a complaint with the Utah Division of Real Estate if you think someone offering loan modification services is trying to scam you. And, you should never ignore mail from your lender or service provider. Many times there will be important information that will need your attention.
Never pay any upfront fees to someone for loan modification services until you receive a written contract with details about the services being provided to you. You can find government sponsored mortgage modification and refinance programs at www.makinghomeeaffordable.gov and .