Mortgage Grapevine

NMLS and loan originator credit report (i.e. score) requirements...

Does anybody know when NMLS will begin pulling credit on registered loan originators next year?

Are any of you in states that already have a credit policy in place?

Please share your state's guidelines.

Thanks in advance.
by TennesseeTuxedo December 23, 2009 8:14 AM

it is on the NMLS website.
post an e-mail addy and I'll send you a copy.

Merry Christmas Tux
by MikeM-NJ December 23, 2009 8:46 AM

Here in Michigan they have said basically that its completely subjective, that there is no score or no item that will automatically disqualify a person.
by MichiganTed December 23, 2009 9:01 AM

This is all that I saw on
the NMLS site. Mike if you
have found something else
please paste or post link.

NMLS Resource Center > Professional Requirements > Credit Report
Credit Report
Starting in 2010, NMLS intends to provide functionality within the system to process independent credit reports from a consumer reporting agency for the purpose of obtaining or maintaining a license in one or more jurisdictions.

Please consult this page for future updates.


by FROG December 23, 2009 9:14 AM

Yes, Ted that makes it tough
to decide if you should hire
and train someone with a 510
credit score due to a BK and
closed business, after writing
loans for 10 years or whatever

by FROG December 23, 2009 9:18 AM

That's all I'm seeing as well FROG.

Mike, what are you finding?

by TennesseeTuxedo December 23, 2009 9:21 AM

I called my contacts in Raleigh, NC because I do have a LO with a BK. I was told that NC would be requiring a 600 score, but they were very short on details as to when and how. I bitched a little because my LO has exactly the senario mentioned above...about 11 years in the business and a smart, very experienced LO who got bit in the asss because almost ALL of his realtor contacts went bust in his area. They couldn't, apparently, care less. 600. So I may have to kick my LO to the curb in his chosen profession because he, like thousands of others, was subject to a difficult downturn over a couple year period.

I hope it can be worked out, because it just isn't right.

by picard December 23, 2009 9:42 AM

Hey! Somebody call Obama. There are quite a few jobs in our industry he would be able to create or save!
by picard December 23, 2009 9:45 AM

It is my understanding that HUD is now developing national guidelines that all states must comply with. One can only imagine what those morons will come up with if it is anything like the new RESPA and Settlement Cost Booklet.

by jenisa December 23, 2009 9:57 AM

Many companies now have W2 originators
on the books that they would never fire
based on production because they wouldn't
want the drag on UNEMP but if an originator
no longer met the requirements (ie 600) he
would find his way to the UNEMP roll since
the employer cannot not have originators on
the job that aren't licensed right? Drag ON.


by FROG December 23, 2009 10:08 AM

Last year for renewal in MA we had to provide individual credit reports. The state of MA did not renew the licenses of two of my salespeople because of their credit.

I had another salesperson that the state was going to deny a license. This person's spouse had had a stroke. The state eventually accepted the credit explanation and renewed the license, because it was for medical reasons.

They questioned any recent late payments. Any state or federal tax liens, bk or charge offs and they will not renew. I have questions NMLS and the other states where we are licensed and it sounds like a decision has not been made or is not public info yet.

This month I have taken the Federal test, NH state test. I am taking the RI state test today.
by ReverseAnswers.com December 23, 2009 10:20 AM

I know an originator that stopped making payments on two homes this year after closing an FHA loan on 12/31/08. Basically qualified for all the properties, (all former primary residences) closed an FHA loan on the new home, and then stopped making payments on the homes they did not occupy. This originator should not be working in the business.
by fisherman December 23, 2009 12:13 PM

I know an originator that stopped making payments on two homes this year after closing an FHA loan on 12/31/08. Basically qualified for all the properties, (all former primary residences) closed an FHA loan on the new home, and then stopped making payments on the homes they did not occupy. This originator should not be working in the business.
by fisherman December 23, 2009 12:13 PM

I'm pretty sure we could locate a originator who smokes crack. He also should not be working in the business.

by Fire for Effect December 23, 2009 12:19 PM

the document is 34 pages long.
every state is listed in a neat and alphabetical format.
trying to figure out how to post it.
by MikeM-NJ December 23, 2009 12:44 PM

Click Here

contained in the NMLS Resource Center under/State Licensing
by MikeM-NJ December 23, 2009 12:48 PM

Just another way of sticking it to us!! Hope next time they use lube!
by bmaraia December 23, 2009 1:49 PM

If you have seriously bad credit you do not belong in this business. If you cannot keep your own house in order, you should not be trusted with anothers house.

In the example I gave above, the originator closed the new loan before the FHA loan amount limit went back up. They gamed the system to get their new home which was more "suitable," and blew the other two off, in spite of being able to afford it.
by fisherman December 23, 2009 2:46 PM

Not everyone with credit issues has done something wrong fishman. Likewise, someone who has credit issues can certainly act professionally and be honest in their dealings with clients. If that is something you don't understand, then you've likely never owned a business or taken risks. Perhaps you're a drone working someplace. It sounds like you have a bone to pick with someone specific. You keep referring to one irresponsible originator. Take your issues up with that originator if you're man enough. Leave your personal problems out of it.

by Fire for Effect December 23, 2009 6:25 PM

Fishman -your impling that those with good credit are ethical.
by MikeM-NJ December 23, 2009 8:40 PM

Fire, see the word "seriously" in my statement. But understand, if you do not pay your bills, and are in a career that is commission based, then you did not save enough when times were good. This shows a possible lack of judgement. I own my own business, have bought and sold dozens of properties over the last 20 years. And, if you did not see the problems we have now coming 5 years ago, you are either inexperienced, or are a total moron. I learned this from my father who was in a feast or famine business. That being said, bad credit often, not always, shows a lack of judgement that could result in a person exercising that same lack of judgment or character with a client. Good credit does not mean you are ethical, but paying your bills is the ethical thing to do it you are able to pay them. If I was getting a loan from someone, I would want to know their finances are not a train wreck.
by fisherman December 23, 2009 11:42 PM

fisherman. Who has to have good credit in order to stay employed? Doctors? Attorneys? Ministers? Teachers? Counselors? Polititians? Stock brokers? Social workers? Don't these people need to prove they don't have poor judgement?

And what constitutes a reason why poor credit is not a poor reflection on one's character? Who decides? If your child or spouse became disabled and drained your funds? If an originator in the business for 3 or 4 years had their spouse (the primary bread winner) lose their job and, as a result, their credit suffered should they be forced out of the business? Speaking of character, should someone be an originator in they don't believe in God? How can you trust their moral judgement??

You may have done well financially. Good for you. Many of us have. But this line of reasoning seems to me to be a very slippery slope. Actually, it sounds both thoughtless and arrogant to me.
by Fire for Effect December 24, 2009 7:57 AM

Would you want an originator with horrible credit due to irresponsibility to help a loved one?

Financial planners have to have their credit pulled, as do other licensed professions. It is clearly a factor in ones history of responsibility. Obviously, one can have bad credit through no fault of their own. Others have bad credit because they are dumb or dishonest. These people have no place in our industry. The God thing you mention Fire is Kooky. And a strange stretch.
by fisherman December 24, 2009 2:16 PM

Would you want an originator with horrible credit due to irresponsibility to help a loved one?
-- by fisherman

You need help.

by Fire for Effect December 24, 2009 3:05 PM

So instead of responding with an interesting nugget of information, you insult.
How sad...
by fisherman December 25, 2009 1:33 AM

Well, fisherman, on the flip side, I certainly would NOT hire the guy who let the spouse die because they felt the right thing to do was to pay Visa, and not the doctor.

Now that represents a problem with judgment.
by HerMortgage March 30, 2010 1:00 AM

I know this is a bit old but today I got one of my best friends tell me that after 14 yrs in the industry she may have to look for another job due to her credit. There are a lot of people with a lot of different opinions on this issue, but what it seems to be a very strange thing is that the same law makers whom have come up with all these after the fact solutions for problems created by over greedy lender, are the same ones who could not pass mustard on this issue.
By the way, when was the last time an ATTORNEY got his license revoked due to bad credit? When was the last time a DOCTOR got his license pulled for the same? When was the last time a LIFETIME POLITICIAN was prevented from running a town or a city due to the credit?
In an industry where now no loan can be closed without a 4506-T OR A 4506T-EZ is pulled at the time of origination it sure seems like over kill in the part of the goverment. By the way, the only ones that have survive are those with a lot of years of experiance, I think that should be a more important factor than your fico score.
by imedina806 October 26, 2010 10:17 PM

Kick em all to the curb, more business for the few of us remaining. Come on, how many out there didn't see this coming and how many were so foolish to think it would never end and over extend and have their overhead set upon record earnings?
by CaymanDM October 29, 2010 9:51 AM

Now put a twist on the question about the attorney, doctor, teacher, etc, regarding credit issues and if they should have their job with bad credit. What about the doctor who is an excellent long standing citizen in the community who cares deeply about his clients but is over weight, eats poorly and doesn't exercise properly? Let's make a law that says you can lose your medical license if your body fax index is above a certain level? How many attorneys have lawsuits against them? How many marriage counselors are divorced? What if they could lose their license if they became divorced. A teacher has tenure and unless they molest a child, they pretty much have a job. I am a 27 year veteran of the industry and have credit issues. It does not compromise my ability to serve my clients. How many perfect credit business people have had affairs? What does that say about their judgement? DUI's - don't see anyone losing their job over one of those...or two...even three. How many judges have DUI's and still serve on the bench? BTW, I've been married 31 years and despite the ups and downs, worked it out and never cheated. Two children with MBA's and a very close family. What does that say about my judgement?
I put my clients first, and unlike many MLO's with stellar credit, never churned loans, never equity skimmed, or put clients into bad loans. I have tremendous repeat clients and referrals. Should I be out of business because I have a tax lien or collections?
It's easy to sit on your high horse of perfect credit and look down on others. Good for you. But don't think your stellar financial acumen makes you the better business person. Many times, its the one with a more human side and mistakes in their life that enable them to empathize with clients and do the right thing at all times.
Not saying those with perfect credit don't do the right thing. Just saying that credit issues don't mean a person doesn't make the right decisions.
I have a legacy of clients who would agree with me.
And one final comment, Barney Frank and Chris Dodd are both overweight. Like the doctors, should they lose their jobs because they are show bad judgement how they care for their own health?
by mlomlo December 7, 2011 10:29 PM


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