The Nationwide Mortgage Licensing System and Registry (NMLS) is expected to begin accepting registrations of residential mortgage loan originators under federal requirements on or around January 31. The federal banking agencies announced on January 4 that they will confirm the opening date for federal registration on the NMLS closer to the actual date and will publish notice of that date in the Federal Register. The agencies jointly issued final rules last July that require residential mortgage loan originators who are employees of national and state banks, savings associations and other depository institutions and certain of their subsidiaries to meet the registration requirements of the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (S.A.F.E. Act). Depository institutions, their subsidiaries and residential mortgage loan originators employed by them will have 180 days from the date the NMLS begins accepting federal registrations to complete initial registration during which period loans can continue to be originated. The federal banking agencies said that they expect the initial registration period to expire on July 29, 2011. After the initial registration period expires, originators will be prohibited from originating residential mortgage loans until they successfully complete the federal registration process. The agencies have advised residential mortgage loan originators employed by depository institutions and their subsidiaries not to register until the agencies instruct them to do so. Updates and technical information about the registration process are available on the NMLS’s web site at: http://mortgage.nationwidelicensingsystem.org/fedreg/Pages/default.aspx.

Notes: The S.A.F.E. Act requires, among other things, that each residential mortgage loan originator who is an employee of a depository institution or a subsidiary of a depository institution be registered with the NMLS. The NMLS is a database created by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators to support the licensing of mortgage loan originators by the states. Each residential mortgage loan originator will obtain a unique identifier when he or she registers with the NMLS. Under the federal rules implementing the S.A.F.E. Act, registered mortgage loan originators and depository institutions must provide these unique identifiers to consumers. Consumers will be able to access employment and other background information about registered mortgage loan originators from the NMLS using the unique identifier for each originator. The S.A.F.E. Act generally prohibits employees of depository institutions or their subsidiaries from originating residential mortgage loans unless they register with the NMLS. The federal rules provide a de minimis exception whereby mortgage loan originators who originated 5 or fewer mortgage loans during the previous 12 months are not required to complete the federal registration process. Under both Massachusetts law and the federal S.A.F.E. Act, employees of banks and their subsidiaries are exempt from state licensing requirements for mortgage loan originators, but agents of banks (independent contractors or other individuals who are not employees) do not qualify for the licensing exemption.