Or a letter to “Sam” to deeper understand my use of acronyms
and silly lingo that did not clarify. Complete with list of vendors
Mortgage Lenders us Residential Mortgage Credit Reports
(RMCR) also called a Tri-Merged report which is more detailed and different
than a consumer credit report. A RMCR report often will have lower FICO scores
than a consumer report. A RMCR is a long form many pages history of payments,
balances, name variations, inquiries, and other details. The RMCR report is
collected from sources and sold to mortgage lenders via what I call
aggregators. These credit aggregators pull the data from the main three credit
cops: Equifax, Experian, and TransUnion plus they add more information. These
main three credit cops also sell RMCR’s.
Here is a list of commonly used and integrated by secure API
to lenders Loan Operating Systems (LOS software):
Accurate Financial
Services ACRAnet, Inc. Advantage Credit, Inc. Advantage Credit Bureau Advantage Plus Credit Reporting, Inc. American Reporting Company, LLC Avantus Birchwood Credit Services, Inc. CBA CBC Innovis, Inc. Certified Credit Reporting, Inc.
CIC Mortgage Credit, Inc. Cisco Credit CIS Info Services
CoreLogic Credco
Credit Associates Credit Data Solutions
CIC
Credit Information Systems Credit Link, LLC Credit Plus, Inc.
CRS
Credit Quick Services Credit Technology, Inc. (CIT) Credit Technologies, Inc. Cred Star Data Facts, Inc. EGS Global Solutions, Inc. Equifax Mortgage Solutions Factual Data aka: MACS Funding Suite Information Searching Company Informative Research
KCB Credit, LLC Kroll Factual Data Merchants Credit Bureau aka: MCB MFI Credit Solutions Midwest Mortgage Credit Services, Inc.
NCO / EGS / Alorica Credit Services, Inc.
Online Information Services, Inc. Partners Credit and Verification Solutions Premium Credit Bureau SARMA Settlement One Sharper Lending, LLC Strategic Information Resources, Inc. The Credit Network KFD United One, Inc. Universal Credit Services, Inc.
Some of these credit
aggregators are patched in directly into mortgage lender software for other
systems to read the bits of data such as monthly payment due, balance, and
averaged middle FICO score. Monthly payments and balances owing are pieces of
information needed for Underwriting approval to discern the debt-to-income
ratio. The middle FICO score is used in LOS in pricing engines and Underwriting
software to determine rate and fees available with these hurdles or attributes. Also, as a deciding
factor to fit the ins and outs of a mortgage loan product at a given moment in
time.
Other plug-in bits
of integration information are:
The Work Number (and
a hundred other Verification of Employment apps or manual order)
New bank statement
reading apps
MERS
Compliance apps
And so forth
All these vendor
pieces are integrated into a lender’s Loan Operating System (there are many of
these, most commonly Encompass (Ellie Mae bought by Intercontinental Exchange
ICE) Empower owned by Black Knight, Blend, Lending QB, Turnkey, Lending Pad, Calyx
Point, Open Point, Meridian, Power Lender, Net Oxygen…
To sell a loan to
Fannie Mae (DU system) or Freddie Mac (LP system) the puzzle pieces, as in all
these parts, must be 1. A provider the end company accepts or certifies 2. Be in
format that flows into now MISMO 3.4 and XML directly into the end approver’s
website.
To sell a loan to
a Non-QM lender they have a different list of acceptable pieces and companies
they require.
To sell to FHA and
USDA again other triangular shaped pieces must fit their square box.
What I was
illustrating is that the originator/ salesperson who is skilled must know their
client’s dark secret story and desires to know before ordering credit, appraisal
and certain pieces of the mortgage application from day one. By ordering a KFD
credit report I cannot sell to Fannie, Freddie, or Non-QM I will need to order
a second report perhaps later in the progress and the FICO middle score will be
lower if I wait more than thirty days to order the second more fitting
appropriate type.
I hope this
explanation of the bones of software, not really the difference in SaaS or
Cloud based or the many varieties of methods to review a home loan.
When I started in
mortgage a pencil, paper, HP, and the borrower was what I needed. Today I can still
outperform all these digital tools when the borrower is self-employed, the
property not cookie cutter, and risk is an issue. Fintech has not put my brain
to pasture, yet.
This information is provided to licensed mortgage professionals only and not for distribution to consumers. Please visit https://www.swmc.com/disclaimer.phpor
How may a person who is ordered to cease and desist be
entitled to a hearing before the commissioner?
The
person must provide to the commissioner professional references from four
borrowers who can attest to the business practices of the person ordered to
cease and desist.
The
person must pay a fine of $10,000 before 30 days after the effective date of
the order (the $10,000 may be refunded to the person if the commissioner
recinds the cease and desist order).
The
person must send a written, notarized Form C&D to the commissioner no later
than two weeks after receiving the notification to cease and desist.
The
person must send a written request for a hearing which is filed 30 days or less
after the effective date of the order..
A person ordered to cease and desist shall be
entitled to a hearing before the commissioner if a written request for a
hearing is filed with the commissioner not more than 30 days after the
effective date of the order. A hearing shall be conducted in accordance with
the provisions of the administrative procedures act of 1969, Act No. 306 of the
Public Acts of 1969, being sections 24.201 to 24.328 of the Michigan Compiled
Laws. (MBLSLA Act 173 of 1987 §445.1666)
How long may a person with a suspended or revoked license
continue to service existing mortgage loans?
up to
one year
N/A;
a person with a suspended or revoked license may discontinue servicing existing
mortgage loans immediately.
up
to 6 months.
up to
3 months
If a person whose license or registration has
been suspended or revoked, summarily, they may continue to service mortgage
loans pursuant to servicing contracts in existence at the time of the
suspension for up to 6 months after the date of the entry of the final decision
of the presiding officer in the contested case suspending or revoking the
license. (MCL §445.1669)
What is the minimum net worth a mortgage broker who
receives funds from a prospective borrower maintain?
not
less than $50,000
not
less than $100,000
not
less than $75,000
not
less than $25,000.
A licensee who acts as a mortgage broker and
who receives funds from a prospective borrower before the closing of the
mortgage loan shall maintain a net worth of not less than $25,000.00. A
licensee who acts as a mortgage lender shall maintain a net worth of not less
than $25,000.00. (MBLSLA Act 173 of 1987 §445.1655)
How
may a person who is ordered to cease and desist be entitled to a hearing before
the commissioner?
The
person must provide to the commissioner professional references from four
borrowers who can attest to the business practices of the person ordered to
cease and desist.
The
person must pay a fine of $10,000 before 30 days after the effective date of
the order (the $10,000 may be refunded to the person if the commissioner
recinds the cease and desist order).
The
person must send a written, notarized Form C&D to the commissioner no later
than two weeks after receiving the notification to cease and desist.
The
person must send a written request for a hearing which is filed 30 days or less
after the effective date of the order..
A person ordered to cease and desist shall be
entitled to a hearing before the commissioner if a written request for a
hearing is filed with the commissioner not more than 30 days after the
effective date of the order. A hearing shall be conducted in accordance with
the provisions of the administrative procedures act of 1969, Act No. 306 of the
Public Acts of 1969, being sections 24.201 to 24.328 of the Michigan Compiled
Laws. (MBLSLA Act 173 of 1987 §445.1666)
The
lender may turn down applicants if they reach a predetermined quota
The
lender may change the size of the loan
The
lender may change the terms with no warning
The
lender must have the full intention of making loans at those rates.
A licensee shall not make a false,
misleading, or deceptive advertisement regarding mortgage loans or the
availability of mortgage loans. A licensee shall not advertise any size of
loan, security required for a loan, rate of charge, or other condition of lending
except with the full intent of making loans at those rates, or lower rates, and
under those conditions, to mortgage loan applicants who meet the standards or
qualifications prescribed by the licensee or registrant. (MBLSLA § 445.1672a)
Coercing an appraiser can result in a fine up to: It's a no no.
$500
$1,000 t$5,000
$15,000
Coercing a real estate appraiser to inflate
the value of real property is a misdemeanor punishable by a fine of not more
than $15,000, imprisonment for not more than 1 year, or both. (Secondary
Mortgage Loan Act § 493.77)
What must a licensee or registrant do should his/her
license or registration certificate be destroyed or lost?
He
/she must pay a fine of $250 to the commissioner for adminstrative costs for
reissuance.
He
/ she must submit a notarized affidavit of the loss with a written notice that
he / she surrenders the license or registration to the commissioner..
He /
she must notify the commissioner and the NMLS within one month of the loss.
He /
she must retake all licensing exams and notify the commissioner that the
license or registration has been lost or destroyed.
A licensee or registrant whose license or
registration certificate has been destroyed or lost may comply with this
section by submitting to the commissioner a notarized affidavit of the loss
accompanied by written notice that the licensee or registrant surrenders the
license or registration. (Secondary Mortgage Loan Act § 493.61)
A secondary mortgage loan may be made by all of the
following EXCEPT:
A
licensed MLO.
A
licensed real estate broker
A
salesperson acting as an agent for a residential builder
A
real estate salesperson
A secondary mortgage loan may be made by
either of the following: a salesperson acting as an agent for a residential
builder, or a licensed residential builder, when made or negotiated in
connection with the sale of a residential structure constructed by that builder
OR a licensed real estate broker or real estate salesperson engaged in the sale
of real estate as a principal vocation, when made or negotiated in connection
with a real estate sale where the real estate broker or salesperson affiliated
with the broker represents either the buyer or seller. (Secondary Mortgage Loan
Act § 493.80)
4
The Commissioner evaluates each application based on all
of the following EXCEPT:
Applicant's
character
Applicant's
medical history.
Applicant's
experience
Applicant's
financial responsibility
The Commissioner evaluates the financial
responsibility, experience, character, and general fitness of the applicant for
a license (Secondary Mortgage Loan Act § 493.55)
A broker who receives funds before the closing of the
secondary mortgage loan must provide proof of financial responsibility in what
amount?
$25,000.
$50,000
$10,000
$75,000
$25,000 for a license or registration to act
as a broker who receives funds from a prospective borrower before the closing
of the secondary mortgage loan or who acts as a lender. (Secondary Mortgage
Loan Act § 493.56)
A licensee under the CFSA is prohibited from all of the
following EXCEPT:
Engaging
as a pawn broker
Engage
in MLO activities.
Engaging
as a debt management company
Engaging
as a real estate broker
A licensee may not: Engage in the business of
a real estate broker or real estate salesperson; Engage in the business of a
pawnbroker; Engage in the business of a debt management company; Entering into
a tying arrangement through which the licensee conditions the sale of one
financial service to a consumer on the agreement by the consumer to purchase
one or more other financial services from the licensee, an affiliate, or
subsidiary of the licensee; Knowingly permit a person to violate an order that
prohibits that person from being employed by, an agent of, or a control person
of the licensee. (Consumer Financial Services Act § 487.2067)
2
How much notice must the Commissioner provide prior to an
annual report's due date?
45
days
30
days.
60
days
14
days
The commissioner shall provide at least 30
days' advance notice of the date each annual report is due. (Consumer Financial
Services Act § 487.2065)
3
If a loan is transferred, the licensee must keep records
available for at least how long?
2
years after the loan is transferred
2
years after the loan is originated.
3
years after the loan is transferred.
3
years after the loan is originated
If the loan is transferred or assigned, the
licensee shall preserve and keep available for examination by the commissioner,
as applicable, copies of the promissory note, mortgage, truth-in-lending
disclosure statement, and settlement statement in its possession or control for
3 years after the date the loan is transferred or assigned. (Consumer Financial
Services Act § 487.2064)
What is the annual operating fee based upon?
Loan
volume and types of activity.
Net
worth
Number
of loan applications
It is
the same for everyone.
The annual operating fee based upon the
volume and types of activities conducted by the licensee during the previous
calendar year. (Consumer Financial Services Act § 487.2061)
The principal amount of a surety bond under the CFSA must
be at least:
$500,000.
$100,000
$50,000
$75,000
The principal amount of a surety bond or
letter of credit shall be at least $500,000.00. (Consumer Financial Services
Act § 487.2056)
What is the maximum civil penalty the Attorney General
may impose on a person?
$20,000
$15,000
$10,000
$5,000
$20,000. The maximum civil penalty the
Attorney General may impose on a person is $20,000, as defined by Section
445.1640 of the Consumer Mortgage Protection Act.
According to the CMPA, what is preempted by state and
federal law?
Municipal
law.
Non
mortgage related laws
Precedence
Administrative
decisions
Both state and federal law regulate the
business of mortgage laws, both of which preempt any municipal laws, defined by
Section 445.1644 of the Consumer Mortgage Protection Act.
Which of the following is NOT included in the Borrower's
Bill of Rights?
The
right to compare the charges of different mortgage brokers and lenders
The
right to obtain a "Loan Estimate" after closing
The
right to be informed about the total cost of the loan
The
right to know what fees are nonrefundable if you decide to withdraw your loan
application
Borrowers have the RIGHT to obtain a
"Loan Estimate" of all loan and settlement charges before they agree
to the loan or pay any fees. (Consumer Mortgage Protection Act § 445.1636)
If a person is found servicing a mortgage loan in a
manner that violates the MBLSLA, the Commissioner may do all of the following
EXCEPT:
Enforce
corresponding penalties
Forward
the complaint to the appropriate regulatory agency
Suspend
the licensee indefinitely
Initiate
a cause of action
If the commissioner determines that a person
is brokering, making, servicing or collecting mortgage loans in violation, he
or she may initiate a cause of action, enforce the corresponding penalties and
remedies, or forward a complaint to the appropriate regulatory or investigatory
authority. (Consumer Mortgage Protection Act § 445.1639)
The claim amount against financial responsibility may
include all of the following EXCEPT:
Excess
escrow paid
Estimated
fees
Actual
fees
Overcharges
of principal
The amount of the claim shall not exceed
actual fees in connection with a loan application, overcharges of principal and
interest, and excess escrow collections charged by the licensee and paid by the
claimant to the licensee. (Consumer Mortgage Protection Act § 445.1638)
If a person is found servicing a mortgage loan in a
manner that violates the MBLSLA, the Commissioner may do all of the following
EXCEPT:
Suspend
the licensee indefinitely.
Initiate
a cause of action
Forward
the complaint to the appropriate regulatory agency
Enforce
corresponding penalties
If the commissioner determines that a person
is brokering, making, servicing or collecting mortgage loans in violation, he
or she may initiate a cause of action, enforce the corresponding penalties and
remedies, or forward a complaint to the appropriate regulatory or investigatory
authority. (Consumer Mortgage Protection Act § 445.1639)
A credit granting institution may consider all of the
following in its lending criteria EXCEPT:
Presence
of active neighborhood organizations
Applicant's
credit eligibility
Market
value of a proposed security
Applicant's
family history.
Lending policies and criteria of a credit
granting institution used in the consideration of a loan application shall
include without limitation the following: consideration of the credit
eligibility of the applicant and the market value of a proposed security; the
presence of active community and neighborhood organization, the presence of
government, nonprofit, and private programs in the neighborhood intended to
eliminate negative environmental influences, other revitalization efforts, and
any other factors potentially mitigating the effect of physical decline.
(Mortgage Lending Practices § 445.1603)
A credit-granting institution must retain a complete
record of each loan application that has been accepted, rejected, or varied for
how long?
25
months after loan application has been submitted or until the loan has been
repaid, whichever is longer
36
months after loan application has been submitted
36
months after loan application has been submitted, except rejected applications,
which may be discarded immediately
25
months after loan application has been submitted or until the loan has been
repaid, whichever is earlier.
A credit granting institution shall retain,
for a period of 25 months after a loan application has been submitted or until
the loan is repaid, whichever is earlier, a complete record of each loan
application which has been accepted, rejected, or varied and the reason for the
application's rejection or variation, together with any other documents
relating to the application. (Mortgage Lending Practices § 445.1607)
Each year, a mortgage servicer must provide the borrower
with a statement providing each of the following EXCEPT:
Amount
deposited into escrow during the entirety of the loan.
Interest
paid during the preceding 12 months
The
loan's unpaid principal balance from the preceding 12 months
Amount
deposited into escrow from preceding 12 months
A mortgage servicer shall annually deliver to
the borrower a statement of the borrower's account, which must show the: •
Unpaid principal balance of the mortgage loan at the end of the immediately
preceding 12-month period • Interest paid during such period • Amounts
deposited into escrow and disbursed from escrow during the period (Mortgage
Lending Practices § 445.1607)
A credit granting institution may not impose a minimum
mortgage amount greater than:
$1,000
$2,500
$10,000.
$5,000
A credit granting institution shall not
impose a minimum mortgage amount greater than $10,000. (Mortgage Lending
Practices § 445.1602)
If there is an error on an appraisal, the credit granting
institution:
Is
liable to the appraiser
Is
liable to the applicant
Is
not liable to the applicant.
Is
liable to the applicant if the error is because of the credit granting
institution
Except for an error or omission that is a
violation, a credit granting institution is not liable to an applicant or any
other person for an error or omission in an appraisal or other supporting
documents made available to an applicant. (Mortgage Lending Practices §
445.1602)
A credit granting institution must post a written notice
in all of the following places EXCEPT:
Call
center.
Service
center
Branch
office
Main
office
A credit granting institution shall post a
written notice in a conspicuous place to reasonably apprise a loan inquirer or
applicant of his or her rights under this act in the institution's main office
and each branch office or service center. (Mortgage Lending Practices §
445.1605)
hat
type of compensation do board members receive?
Board members are not compensated. However, the DFIS
shall reimburse members for travel and other expenses incurred in the
performance of an official board function. (MBLSLA § 445.1683)
The
principal amount of a surety bond under the CFSA must be at least:
The principal amount of a surety bond or letter of credit
shall be at least $500,000.00. (Consumer Financial Services Act § 487.2056)
Coercing
an appraiser can result in a fine up to:
Coercing a real estate appraiser to inflate the value of
real property is a misdemeanor punishable by a fine of not more than $15,000,
imprisonment for not more than 1 year, or both. (Secondary Mortgage Loan Act § One of the steeper newer fines in the industry 493.77)
The
Commissioner evaluates each application based on all of the following EXCEPT:
The Commissioner evaluates the financial responsibility,
experience, character, and general fitness of the applicant for a license
(Secondary Mortgage Loan Act § 493.55)
A
licensee under the CFSA is prohibited from all of the following EXCEPT:
A licensee may not: Engage in the business of a real
estate broker or real estate salesperson; Engage in the business of a
pawnbroker; Engage in the business of a debt management company; Entering into
a tying arrangement through which the licensee conditions the sale of one
financial service to a consumer on the agreement by the consumer to purchase
one or more other financial services from the licensee, an affiliate, or
subsidiary of the licensee; Knowingly permit a person to violate an order that
prohibits that person from being employed by, an agent of, or a control person
of the licensee. (Consumer Financial Services Act § 487.2067)
A
claim amount may include all of the following EXCEPT:
The amount of the claim shall not exceed actual fees paid
by the claimant to the licensee in connection with a loan application,
overcharges of principal and interest, and excess escrow collections by the
licensee. (Consumer Financial Services Act § 487.2056)
What
is the Mortgage Industry Advisory Board's primary responsibility?
The board communicates to the commissioner issues of
concern to the residential mortgage industry and reviews and makes
recommendations on rules and procedures pertaining to the mortgage industry.
(MBLSLA § 445.1683)
An
application must include all of the following information EXCEPT:
The application must state the name, residence, and
business addresses of the applicant, each member if the applicant is a
partnership, association, or limited liability company, and of each officer,
director, and stockholder if the applicant is a corporation. (Secondary
Mortgage Loan Act § 493.53)
When
can an MLO in Michigan reapply for a license that was revoked 12 years ago in
New Jersey?
You can never reapply for an MLO license if
your mortgage license has been revoked anywhere once you are out you can never get back in as so much financial information needs to be secure and held by honest people, as defined by Section
493.139 of the Mortgage Loan Originator Licensing Act 75 of 2009.
If there is an error on an appraisal, the
credit granting institution:
Except for an error or omission that is a
violation, a credit granting institution is not liable to an applicant or any
other person for an error or omission in an appraisal or other supporting
documents made available to an applicant. (Mortgage Lending Practices §
445.1602)
What
is the maximum fine the Commissioner may impose for a violation?
The Commissioner may impose a civil fine on
an MLO if the Commissioner finds, on the record after notice and opportunity
for hearing, that the MLO has violated or failed to comply with any
requirements, a rule promulgated by the Commissioner, or any other applicable
order issued. (MLO Licensing Act § 493.155)
12
The
Mortgage Industry Advisory Board consists of how many members?
The board consists of 7 individuals,
appointed by the commissioner. (MBLSLA § 445.1683)
Which
of the following is NOT an example of a bona fide error?
Examples of a bona fide error include
clerical, calculation, computer malfunction, programming, or printing errors.
An error in legal judgment with respect to a person's obligations is not a
bona fide error. (Consumer Mortgage Protection Act § 445.1641)
Out
of the following reasons, a credit granting institution may only deny a loan
application because of:
A credit granting institution shall not
deny a loan application for either of the following: racial or ethnic
characteristics or trends in the neighborhood in which the real estate is
located; the age of the structure on the real estate proposed as security or
the age of other structures in the neighborhood in which the real estate is
located. This does not preclude a credit granting institution from
considering the physical condition and probable remaining useful life of the
structure and all structures within a radius of 750 feet. (Mortgage Lending
Practices § 445.1602)
What
must a licensee or registrant do should his/her license or registration
certificate be destroyed or lost?
A licensee or registrant whose license or
registration certificate has been destroyed or lost may comply with this
section by submitting to the commissioner a notarized affidavit of the loss
accompanied by written notice that the licensee or registrant surrenders the
license or registration. (Secondary Mortgage Loan Act § 493.61)
How often must an organization file an affidavit stating it meets
qualifications?
An organization must file an affidavit
that it continues to meet the qualifications by February 1 every other year.
(MBLSLA § 445.1675a)
Which of the following would not be exempt from licensure in
Michigan?
An out-of-state person originating
mortgages for properties located in Michigan. An MLO would not be exempt
from licensing if they were located out-of-state, as defined by Section
445.1675 of the Mortgage Brokers, Lenders, and Servicers Licensing Act 173
of 1987.
A lender does not need to be licensed under the Secondary Mortgage
Loan Act if he or she services less than how many secondary mortgage loans a
year?
A lender is exempt if he or she makes or
negotiates two or fewer secondary mortgage loans in a calendar year.
(Secondary Mortgage Loan Act § 493.52)
What is the minimum net worth a
mortgage broker who receives funds from a prospective borrower maintain?
A licensee who acts as a mortgage broker
and who receives funds from a prospective borrower before the closing of the
mortgage loan shall maintain a net worth of not less than $25,000.00. A
licensee who acts as a mortgage lender shall maintain a net worth of not
less than $25,000.00. (MBLSLA Act 173 of 1987 §445.1655)
According to DIFS, an MLO
license would be required for which of the following?
A person originating 1st mortgages. A
Mortgage license would be required for a person originating 1st mortgages,
as defined by Section 493.135 of the Mortgage Loan Originator Licensing Act
75 of 2009.
A secondary mortgage loan may be
made by all of the following EXCEPT:
A secondary mortgage loan may be made by
either of the following: a salesperson acting as an agent for a residential
builder, or a licensed residential builder, when made or negotiated in
connection with the sale of a residential structure constructed by that
builder OR a licensed real estate broker or real estate salesperson engaged
in the sale of real estate as a principal vocation, when made or negotiated
in connection with a real estate sale where the real estate broker or
salesperson affiliated with the broker represents either the buyer or
seller. (Secondary Mortgage Loan Act § 493.80)
A home improvement loan minimum
may not be more than:
A credit granting institution shall not
impose a minimum loan amount of greater than $1,000 for a home improvement
loan. (Mortgage Lending Practices § 445.1602)
Before a license is suspended,
the licensee must receive how much notice?
A license shall not be suspended or
revoked until after 10 days' notice to the licensee setting forth in writing
the reasons for the suspension or revocation. (Consumer Financial Services
Act § 487.2060)
Which of the following must be
provided by the lender at the time of a mortgage loan application?
The lender must provide a credit
counseling notice, as well as a Borrower's Bill of Rights. (Consumer
Mortgage Protection Act § 445.1636 and § 445.1637)
DIFS is required to create a
model financial program that includes all of the following basic
principles EXCEPT:
The program must be designed to teach
personal financial management skills and the basic principles involved
with saving, borrowing, investing, and protection against predatory and
other fraudulent lending practices. (Consumer Mortgage Protection Act §
445.1643)
$22,969
Loan Amount < $114,847
