By Thomas Ressler
The Community Home Lenders Association recently sent a letter to CFPB Director Richard Cordray, asking the agency to require consumer disclosures on each mortgage indicating whether the loan officer working the deal is licensed.
Such disclosures also should show whether the LO has passed the SAFE Act test, and has completed an independent background check and SAFE Act approved pre-licensing and continuing education courses.
CHLA is recommending that consumers be told if their loan originator previously failed (and never passed) the SAFE Act test or has ever been denied a state license because they failed a background check.
“The CFPB is carrying out its ‘Know Before You Owe’ initiative, to improve consumer understanding and mortgage disclosures,” the letter said. “We believe that these objectives of improving consumer disclosures and understanding are incomplete without requiring disclosures related to a major cause of the subprime mortgage crisis – the qualifications of the mortgage loan originator who worked with the consumer on the loan.” For full details, see Inside the CFPB, now available online.