As per the Office of Financial Institutions, Act 260 requires a license and Louisiana Mortgage Servicer surety bond. The Act adds a license requirement for persons engaged in residential mortgage servicing to the current Louisiana Secure and Fair Enforcement of Mortgage Licensing Act of 2009 (SAFE Act). The Act defines “mortgage servicing” as a means of collecting or remitting payment for another, or the right to collect or remit payments for another, relative to the principal, interest, tax, insurance, or other payment under a mortgage loan. The Act also amends the definition of “residential loan transaction” and “residential mortgage lending activity” and adds the definition of “mortgage servicing”. The Act subjects mortgage servicers to the same licensure requirements as well as the application, renewal, and surety bond requirements as other mortgage brokers and lenders.
Mortgage servicers are required to obtain a license on or before June 30, 2015 utilizing the online Nationwide Mortgage Licensing System and provide the appropriate Louisiana mortgage loan servicers surety bond. If an entity is currently licensed in Louisiana for mortgage brokering or lending activities, there is no requirement for an additional license to perform mortgage servicing. However, if an entity performs mortgage servicing for Louisiana consumers, the entity is required to designate mortgage servicing as a “business activity” of their Louisiana license in the NMLS online licensing system (Nationwide Mortgage Licensing System). Potential mortgage servicers can apply for the residential mortgage license at any time and request the license be issued at a future date, but not later than June 30, 2015, once the application is complete. Should the applicant choose a date in 2014 to be licensed, the applicant would be required to renew the license for 2015 and pay all applicable fees on or before 12/31/2014. In addition, if a mortgage servicer is negotiating terms of loans, such as a refinance or a modification, the entity should ensure that the individuals who are performing the functions of a residential mortgage loan originator for Louisiana consumers, should also apply and obtain a Louisiana residential mortgage originators license.
License information can be found on the National Mortgage Licensing System portal at http://mortgage.nationwidelicensingsystem.org/slr/Pages/DynamicLicenses.aspx?StateID=LA. The new mortgage servicer license requirements are not available as of this date however the same will be forthcoming. The surety bond requirements likewise have not been provided however they will likely follow the $25,000 and $50,000 penalties as required of mortgage loan orginators.
Louisiana surety leader, Surety One, Inc. is a specialist in the bonding needs of the mortgage loan origination, brokering servicing sectors. We offer both the surety and fidelity bonds required of mortgage professionals in ALL fifty states, Puerto Rico and the U.S. Virgin Islands. Do you operate in multiple states? View our state-by-state report of mortgage broker bond requirements here. Visit us at SuretyOne.com, call (787) 333-0222 or (800) 373-2804, or email us at Underwriting@SuretyOne.com for an Louisiana mortgage servicer surety bond application or information on ANY surety or fidelity bond need.