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Information herein is for educational purpose only and is not meant to be a complete statement of all state mortgage licensing requirements. Additional State and FHA mortgage licensing requirements may be required. If you need further information, we would encourage you to contact us directly.
FAQ for Washington Consumer Loan License Changes
When SB
6471 was passed during the 2008 legislative session and became
effective June 12, 2008, the definition of mortgage broker under the
MBPA was amended to remove references to making a loan. The
net effect of the amendment was to prohibit lending under the
MBPA. SB 6471 also expanded the Consumer Loan Act (CLA) to
all lending in
Because
licensing under the CLA would have caused mortgage brokers to incur the
cost of a much larger bond, and to otherwise delay the impact of the
license change on the mortgage broker industry at a time when the
industry was beginning to suffer due to the economic downturn, the
department created the means for brokers acting as non-delegated
correspondent lenders to remain licensed under the MBPA.
Now that
the legislature has amended both the MBPA and CLA bonding requirements,
effective January 1, 2010, and particularly because the CLA bonding
will be significantly lower, non-delegated correspondent lenders
licensed under the MBPA must license under the CLA.
Frequently
asked questions:
What
activities will remain permissible under the MBPA?
Effective
January 1, 2010, companies licensed under the MBPA will only be
permitted to broker or table fund loans.
Will
companies licensed under the MBPA still be able to act as a
non-delegated correspondent lender?
No.
In order to act as a non-delegated correspondent lender beyond 2009, a
company must be licensed under the CLA.
My
company is licensed under the MBPA and wants to continue as a
non-delegated correspondent lender, what action must I take?
If you
are licensed under the MBPA and wish to act as a non-delegated
correspondent lender beyond 2009 your company must obtain a license
under the CLA.
When
should my company apply for a license under the CLA?
To avoid
potential business interruption and allow for application processing
time, the department recommends that you apply for a CLA license no
later than October 31, 2009.
What
benefit will my company receive by applying for a CLA license before
October 31, 2009?
If you
are licensed under the MBPA and submit a complete CLA license
application by October 31, 2009, you will avoid potential business
interruption and allow for application processing time. In
addition, to cover the additional cost of licensing under the CLA, if
you convert to the CLA in 2009 you will not have to pay assessments or
file a CLA annual report for CLA activity during 2009.
As
a CLA licensee must I also hold an MBPA license to broker loans?
Brokering
and lending are both permitted under the CLA license.
Where
can I find more information about converting to a license under the CLA?
Please
visit our website http://dfi.wa.gov/cs/consumer_loan_apply.htm
for instructions on submitting a CLA license application.
More details about converting to the CLA will follow in the coming
months, so please watch for additional ListServ messages and
information on our website regarding this topic.
06.22.2009. 15:52
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