§5117 — Title 12 Banks and Banking | U.S. Code

Summary

Lets registered or state-licensed loan originators work temporarily in a new State while their State license application is being processed, if they meet certain rules. application State — the State where the person wants a license. State-licensed mortgage company — a company licensed by a State to do home loan origination and processing. A person can get temporary permission to act as a loan originator in the application State when they send the information required under section 5104(a) if they have not had a license denied, revoked, or suspended; have not been hit with a cease-and-desist order; have no disqualifying criminal conviction; and have filed the State application. A registered originator must have been in the Nationwide Mortgage Licensing System and Registry as a loan originator within the past 1 year. A State-licensed originator must be employed by a State-licensed mortgage company in the application State and must have been licensed in another State in the 30 days before filing. The temporary permission starts when that information is submitted and ends when the applicant withdraws, the State denies or says it will deny, the State grants a license, or 120 days pass if the application is shown as incomplete. Employers and workers with this temporary permission must follow the same federal and State rules as fully licensed originators.

Title 12, §5117

Banks and Banking — Source: USLM XML via OLRC

(a)In this section:

(1)The term “application State” means a State in which a registered loan originator or a State-licensed loan originator seeks to be licensed.

(2)The term “State-licensed mortgage company” means an entity that is licensed or registered under the law of any State to engage in residential mortgage loan origination and processing activities.

(b)(1)Upon becoming employed by a State-licensed mortgage company, an individual who is a registered loan originator shall be deemed to have temporary authority to act as a loan originator in an application State for the period described in paragraph (2) if the individual—

(A)has not had—

(i)an application for a loan originator license denied; or

(ii)a loan originator license revoked or suspended in any governmental jurisdiction;

(B)has not been subject to, or served with, a cease and desist order—

(i)in any governmental jurisdiction; or

(ii)under section 5113(c) of this title;

(C)has not been convicted of a misdemeanor or felony that would preclude licensure under the law of the application State;

(D)has submitted an application to be a State-licensed loan originator in the application State; and

(E)was registered in the Nationwide Mortgage Licensing System and Registry as a loan originator during the 1-year period preceding the date on which the information required under section 5104(a) of this title is submitted.

(2)The period described in this paragraph shall begin on the date on which an individual described in paragraph (1) submits the information required under section 5104(a) of this title and shall end on the earliest of the date—

(A)on which the individual withdraws the application to be a State-licensed loan originator in the application State;

(B)on which the application State denies, or issues a notice of intent to deny, the application;

(C)on which the application State grants a State license; or

(D)that is 120 days after the date on which the individual submits the application, if the application is listed on the Nationwide Mortgage Licensing System and Registry as incomplete.

(c)(1)A State-licensed loan originator shall be deemed to have temporary authority to act as a loan originator in an application State for the period described in paragraph (2) if the State-licensed loan originator—

(A)meets the requirements of subparagraphs (A), (B), (C), and (D) of subsection (b)(1);

(B)is employed by a State-licensed mortgage company in the application State; and

(C)was licensed in a State that is not the application State during the 30-day period preceding the date on which the information required under section 5104(a) of this title was submitted in connection with the application submitted to the application State.

(2)The period described in this paragraph shall begin on the date on which the State-licensed loan originator submits the information required under section 5104(a) of this title in connection with the application submitted to the application State and end on the earliest of the date—

(A)on which the State-licensed loan originator withdraws the application to be a State-licensed loan originator in the application State;

(B)on which the application State denies, or issues a notice of intent to deny, the application;

(C)on which the application State grants a State license; or

(D)that is 120 days after the date on which the State-licensed loan originator submits the application, if the application is listed on the Nationwide Mortgage Licensing System and Registry as incomplete.

(d)(1)Any person employing an individual who is deemed to have temporary authority to act as a loan originator in an application State under this section shall be subject to the requirements of this chapter and to applicable State law to the same extent as if that individual was a State-licensed loan originator licensed by the application State.

(2)Any individual who is deemed to have temporary authority to act as a loan originator in an application State under this section and who engages in residential mortgage loan origination activities shall be subject to the requirements of this chapter and to applicable State law to the same extent as if that individual was a State-licensed loan originator licensed by the application State.

Statutory Notes and Related Subsidiaries

Effective Date

Section effective 18 months after May 24, 2018, see section 106(d) of Pub. L. 115–174, set out as an

Effective Date

of 2018 Amendment note under section 5112 of this title.

§5117 Employment transition of loan originators

Summary

Title 12, §5117

Notes & Related Subsidiaries

Statutory Notes and Related Subsidiaries

Effective Date

Effective Date

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