Industry Letter

Mortgage Loan Originator Licensing

July 21, 2010

To the Mortgage Banker or Mortgage Broker Addressed:

As you are aware, Article 12-E of the New York Banking Law requires mortgage loan originators to complete 20 hours of pre-licensing education course work, including three hours of New York specific laws and regulations; pass the SAFE Act Test consisting of national and state components, and demonstrate financial responsibility. A criminal background review is also required.

Unless mortgage loan originators employed by your firm filed an application prior to December 1, 2009 and can demonstrate that they met all of the pre-licensing requirements by July 31, 2010, they are prohibited by Section 420.4(c) of the Superintendent’s Regulations from engaging in mortgage loan origination activities for properties located in New York State effective August 1, 2010. Mortgage Loan Originators approved (NMLS license status Approved; Approved-Conditional; Approved-Inactive) prior to July 11, 2009 have until August 31, 2010 to complete the above referenced requirements.

We are rescinding the temporary authorization letter issued by the New York State Banking Department (“Department”). Therefore, after July 31, 2010, mortgage loan originators cannot utilize the temporary authorization letter to originate mortgage loans on New York property and your firm cannot rely on such letters to market or close mortgage loan transactions.

The Department will place applications on hold for a period of 60 days from July 31, 2010. Mortgage loan originators who fulfill the pre-licensing requirements between August 1, 2010 and October 1, 2010, cannot originate mortgage loans until the Department has approved their application. If mortgage loan originators employed by your firm have not fulfilled the pre-licensing requirements by October 1, 2010, their application will be processed for denial.

Engaging in mortgage loan origination activities without a license is a violation of the New York Banking Law. The Department will utilize all of its available resources to cause any individual engaged illegally in mortgage loan activities to cease such activities and will consider such illegal activity in determining fitness for future licensing. In addition, it will pursue appropriate enforcement proceedings against entities utilizing such persons.

You may consult our website at www.banking.state.ny.us/mbmlo.htm for additional information on mortgage loan originator licensing. Should you have any further questions, please contact Oronzo Nardulli at (212) 709-5556.

Very truly yours,

Rholda L. Ricketts
Deputy Superintendent of Banks