Loan officers need to really pay attention to the guidance they receive and authority they give over to others in the use of their NMLS number. Loan applications you are taking today can have much farther reaching affect on your career than you can imagine.
Of course, this goes for anyone that has an NMLS number, but today it is the LO's number that goes on the loan application and not others involved in the process. Hopefully that will change and everyone will be held responsible. For example: if you, the LO, are given wrong advice about how to structure that loan and years from now it is determined there were inappropriate actions involved in that file, it is your number associated with that file.
One file might not be that big of a problem, but what if it happens on 5, or 10? Auditors look for patterns and history proves they look to licensing numbers for responsibility. (I've been told that the new federal agency's interim director has made the statement "we are coming out swinging and we will make examples."
In part, I'm saying that loan officers can no longer just sloth accountability off to the processor or underwriter any longer. They shouldn't have anyway, but that's what has happened too much of the time. The accountability has been ratcheted up in a lot of ways and this is just one of them.
Be aware of who you are giving access to your NMLS number. It can make a difference to your career.
To that end....Comments and dialog welcome!! See comment section below or email me at danny@rp2development.com or 512-773-6528,
Danny
Note: this is an edited re-posting from 28 August, 2010.
Of course, this goes for anyone that has an NMLS number, but today it is the LO's number that goes on the loan application and not others involved in the process. Hopefully that will change and everyone will be held responsible. For example: if you, the LO, are given wrong advice about how to structure that loan and years from now it is determined there were inappropriate actions involved in that file, it is your number associated with that file.
One file might not be that big of a problem, but what if it happens on 5, or 10? Auditors look for patterns and history proves they look to licensing numbers for responsibility. (I've been told that the new federal agency's interim director has made the statement "we are coming out swinging and we will make examples."
In part, I'm saying that loan officers can no longer just sloth accountability off to the processor or underwriter any longer. They shouldn't have anyway, but that's what has happened too much of the time. The accountability has been ratcheted up in a lot of ways and this is just one of them.
Be aware of who you are giving access to your NMLS number. It can make a difference to your career.
To that end....Comments and dialog welcome!! See comment section below or email me at danny@rp2development.com or 512-773-6528,
Danny
Note: this is an edited re-posting from 28 August, 2010.
5 comments:
I got your newsletter last night and saw this article link.
Can you give more details?
If my processor or underwriter misses something, how can I be held responsible?
Thanks...and I'll not give me name!!
Danny, yes please, I'd like to know more about this subject.
The loan is ultimately the responsibility of the originator. I'm a producing br mgr for 18 yrs. Recently the co i work for showed me an evalutation they did of my personal production over the last 3 years. We're a very large company and sell secondary to BofA,GMAC,Wells just to name a few. My company was able to go to one of these co's and pull a performance ck over my entire line of production for the past 3 years. Now with NMLS# it's even easier. My company used this as a measuring guage in our compensation plan. They showed me tables on Quality (12mo delinquency), Pull thru, and EPD. Using a grading method of 1-5 with 1 being the best i scored 1's in all catagories. this enabled me to negotiate a few extra BP's on my personal production comp plan. When you do 15-20 mil a year a couple of BP's is a lot of money.
The days of originators being able to blame someone else is way over. The Feds intend on holding the originator responsible..and to be honest i for one agree.
I believe the last comment above sums it up.
Financially, the mortgage companies has the same responsibility it has always had in relationship to its contracts, reps and warrants.
But....the loan officer's number is on the loan application.
No matter what happens between the company, the lender, FHA/FNMA and their lawyers.....the performance factor of that loan is held up against the loan officer.
Whether a loan gets to a point of legal concern or not, the loan officer's number is directly impacted.
Just like the comment above, the loan officer's career performance going forward is going to be tracked.
His/her book of business, the types of loans, the size loans, the average credit scores, etc, etc, etc.
Like the guy said above, the loan officer can't run from responsibility any longer.
I'm a loan officer. I start the loan, I should be professional enough insure to insure I'm putting a good loan into the system.
We can blame Wall Street, the big banks and whomever we want for the problems, and I agree that they are the ones that come up with the products in the first place.
And you know, it will probably circle right back around and do to some Politically Correct issue, or pure greed, we'll have some of that product to sell again.
But, this time, the loan officer's license will be on the record and when the dust settles, law suites are filed and beat up through the courts, that NMLS# will be hit and the LO's ability to do loans will be impacted long before ink on all the legal stuff is even dry.
Loan officers really do need to be working for companies they can trust to hire and train the right people to help protect their license.
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