National Mortgage Professional Magazine - June 2010

Are You Certifiable?

Certification through the Nationwide Mortgage Licensing System (NMLS) allows mortgage loan originators (MLOs) to use their previously completed education and state testing to satisfy certain state and national SAFE Act requirements. If your state is participating and certifies your past completion of education, you may not have to take the required 20 hours of NMLS-approved pre-licensure education (PE). If your state certifies that you have previously passed a state licensing test, you may not be required to take your state’s SAFE test component.

Certification does not cover national testing. Every state-licensed MLO must take and pass the National Test Component by the prescribed state deadline. In short, if you intend to obtain a state license to originate, you will be taking the national test. If your state is participating in certification, you may not need to take PE or a state test.

Are you eligible?

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If you are an MLO in one of the 35 states that have chosen to participate in certification, you may be eligible to participate. This includes certification of state testing and/or education. Certification is optional and some states have decided not to participate.

If your state has elected to participate, they are required to communicate with whom they intend to certify. Each state has set deadlines by when you must have completed your previous education and/or state test in order to qualify. In order to participate, you must perform certain prescribed tasks to be certified and recorded in the NMLS.

Your next steps

JUNE 2010

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

NationalMortgageProfessional.com

1. MU4 filing To begin, you must apply for licensure with one state that will certify your past education and/or testing. To do so, make a MU4 filing through the NMLS. Access the “Getting Started: MLOs” section on the NMLS Web site for assistance.

2. Determine your state’s participation States began submitting certification with the NMLS in May of this year. Check the “Certification State List” section of the NMLS site to determine if the state in which you want to obtain a license in is participating in certification. Once you have filed your MU4 with that state, the NMLS should notify you that your certification invoice can be paid.

3. Pay invoice The invoice must be paid directly by the MLO following the step-by-step instructions in your NMLS notification. The costs are: O Education certification: $15 O Each state test certification: $5 4. Verify To confirm that you are “PE compliant” and/or “state test component compliant,” you can see your records by going to “Confirmation of Testing or Education Certification Quick Guide” section on the NMLS Web site.

A SAFE Smart shortcut Certification is one SAFE Act shortcut allowed to MLOs by the State Regulatory Registry (SRR) Board, which approves NMLS policies. By taking advantage of the certification process, you save the time, money and stress of the 20-hour PE and state testing requirements. The fly in the ointment is that you will still be required to take and pass the national test.

Paul Donohue, CRMS is a 23-year industry professional and founder of Abacus Mortgage Training and Education. Paul served on two NMLS working groups, establishing the new national education protocols. Go to AbacusMortgageTraining.com to find out more about your obligations for testing, education and licensure, or call (888) 341-7767.

HUD releases April loan mod report: 13 percent increase in permanent mods over March’s numbers The U.S. Department of the Treasury and the U.S. Department of Housing & Urban Development (HUD) have released April data for the Administration’s Home Affordable Modification Program (HAMP) showing that permanent modifications for almost 300,000 homeowners—an increase of 68,000 or almost 13 percent over March.

New in this month’s report is information about servicer-specific conversion rates to permanent modifications and servicer performance in giving homeowners timely decisions. The data show that there is wide variation among servicers in these areas, further demonstrating the need for transparency regarding servicer performance.

“The number of homeowners receiving significant relief through a mortgage modification continues to rise,” said Chief of Treasury’s Homeownership Preservation Office (HPO) Phyllis Caldwell. “Our focus now is on improving the homeowner experience and holding servicers accountable for their performance. Increased transparency through more robust reporting of servicer-specific data will contribute handily to those efforts.”

“As the number of homeowners receiving permanent modifications continues to increase, the Administration’s comprehensive efforts are making an impact in the housing market’s overall recovery,” said FHA Commissioner and HUD Assistant Secretary for Housing David H. Stevens. “Today, mortgage rates remain at historic lows, around five percent; foreclosure starts are down 27 percent from last year this time; and home prices and the pace of home sales have stabilized in recent months.”

As part of a continued effort to improve servicer performance, the Administration hosted a summit with representatives from participating mortgage servicing companies to discuss ways to move qualified homeowners into permanent modifications, improve homeowners’ HAMP experience, quickly implement the Second Lien Modification Program and Home Affordable Foreclosure Alternatives (HAFA), and maintain the pace of new trial modification starts. The Administration also outlined for servicers its plans to begin reporting more detailed performance

measures. By July 2010, this reporting will include the eight largest servicers and will focus on servicer compliance, program execution and homeowner experience.

In the coming months, the Administration will continue to enhance its methods of holding servicers accountable for their obligation to provide helpful and timely assistance to struggling homeowners. While enabling eligible homeowners to modify their mortgages is vital to addressing the housing crisis, this program is just one part of the Obama Administration’s multi-faceted approach to assisting homeowners and stabilizing the housing market, which also includes state and local housing agency initiatives, tax credits for homebuyers, neighborhood stabilization and community development programs, mortgage refinancing, and support for Fannie Mae and Freddie Mac. For more information, visit www.financialstability.gov.

HOPE NOW reports 476,000-plus loan mods in first quarter of 2010 HOPE NOW, the private sector alliance of mortgage servicers, investors, mortgage insurers and non-profit counselors has announced that its first quarter 2010 data shows a surge in solutions for troubled homeowners, including completed loan modifications, trial modifications and other workout plans. In all, the industry completed almost half a million loan modifications for homeowners (476,192) in the first quarter of 2010—a 29 percent increase from same quarter last year. These modifications combine proprietary modifications with Home Affordable Modification Program (HAMP) permanent modification solutions, as reported monthly by Treasury.

In the first quarter of 2010, the industry completed 312,329 proprietary loan modifications and 163,863 permanent HAMP modifications.

Since July of 2007, over 2.88 million borrowers have been offered modifications that allow them to stay in their homes. HOPE NOW and its Alliance partners recently expanded and retooled survey data reporting, collecting only proprietary modifications and continued on page 6