IBA Compliance Connection

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We originated a business-purpose mortgage loan. The loan documents use two different loan officers’ NMLS identifiers, because a second loan officer took over the file after the original loan officer left our bank. Now, the secondary market investor is refusing to purchase the loan because of the discrepancy in NMLS identifiers. Do the NMLS identifier requirements apply to non-consumer loans?

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No, the requirements to use the NMLS identifier on loan documents and elsewhere do not apply to non-consumer loans. Regulation Z’s NMLS identifier requirements apply only to consumer credit transactions secured by a dwelling. Similarly, the SAFE Act’s NMLS identifier requirements apply only to originations of consumer-purpose residential mortgage loans.

However, it is possible that the secondary market investor is objecting on the basis of its own NMLS identifier requirements, which are a matter of the agreement between your institution and the investor.

For resources related to our guidance, please see:

  • Regulation Z, 12 CFR 1026.36(g) (“For a consumer credit transaction secured by a dwelling, a loan originator organization must include on the loan documents described in paragraph (g)(2) of this section . . . (i) Its name and NMLSR ID . . . .”)
  • SAFE Act regulations, 12 CFR 1007.102 (“Residential mortgage loan means any loan primarily for personal, family, or household use that is secured by a mortgage, deed of trust, or other equivalent consensual security interest on a dwelling . . . .”)