IBA Compliance Connection

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We have a residential mortgage employee whose job title is “loan specialist.” He is not an officer of our bank, but he has registered with the Nationwide Mortgage Licensing System (NMLS) and obtained an NMLS registry number. Can he sign Fannie Mae Uniform Residential Loan Applications (URLAs) as a mortgage loan originator? Or does he need to have the title of “loan officer” or any other qualifications or credentials?

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Yes, we believe that your employee may sign Fannie Mae ULRAs as a mortgage loan originator. You stated that the employee has registered with the NMLS and has obtained an NMLS registry number. By taking those steps, your employee has satisfied the requirements of federal SAFE Act to act as a residential mortgage loan originator. The only place for a mortgage loan originator signature on the Fannie Mae ULRA is the section pertaining to government monitoring information for certain types of loans. Fannie Mae’s ULRA instructions for completing this section require only that the individual be a mortgage loan originator, which your employee is. No other specific title or credential is required.

However, we do not recommend permitting this employee to sign any documents on behalf of the bank that may bind the bank to a contract, such as a loan commitment. Authority to contractually bind the bank generally is created by granting the employee status as an officer of the bank, which has not occurred here.

For resources related to our guidance, please see:

  • SAFE Act Regulations, 12 CFR 1007.103(a) (“Each employee of a covered financial institution who acts as a mortgage loan originator must register with the Registry, obtain a unique identifier, and maintain this registration in accordance with the requirements of this part. Any such employee who is not in compliance with the registration and unique identifier requirements set forth in this part is in violation of the S.A.F.E. Act and this part.”)
  • SAFE Act Regulations, 12 CFR 1007.102 (“Mortgage loan originator means (1) An individual who: (i) Takes a residential mortgage loan application; and (ii) Offers or negotiates terms of a residential mortgage loan for compensation or gain . . . .”)
  • Fannie Mae Form 1003, Uniform Residential Loan Application and Instructions (rev. 6/09), Application Page 4, Information for Government Monitoring Purposes (“The following information is requested by the Federal Government for certain types of loans related to a dwelling in order to monitor the lender's compliance with equal credit opportunity, fair housing and home mortgage disclosure laws. . . If you do not furnish ethnicity, race, or sex, under Federal regulations, this lender is required to note the information on the basis of visual observation and surname if you have made this application in person. . . . (Lender must review the above material to assure that the disclosures satisfy all requirements to which the lender is subject under applicable state law for the particular type of loan applied for.)”)
  • Fannie Mae Form 1003, Uniform Residential Loan Application and Instructions (rev. 6/09), Instructions Page 3 (“The loan originator must complete this portion of the form to indicate the method used to take the application and to provide the loan originator's name, ID, and telephone number, as well as his or her employer's name, company ID, and address.”)