Did the CFPB Mandate Education for Bank Originators?
Did the game just change? For the sake of full disclosure, I am an originator, course developer and trainer.
I think you may want to read the recently released guidance.
This is not a secret. Consumers do not know the differences between “individual originators,” registered or licensed or brokers, lenders or banks. They think we all do the same thing with a similar level of knowledge. It’s just one reason why there were so many problems leading up to the crisis. And while we in the mortgage business know the reality, the BCFP may have just leveled the playing field a bit!
According to the CFPB November 9, 2018 released Loan Originator Rule – Small Entity Compliance Guide.
Can you answer this question? What training must a loan origination organization provide for loan originator employees, not required to be licensed under the SAFE ACT?
The rule requires “individual loan originators NOT licensed under the SAFE Act, to be trained in “the responsibilities of individual loan originators and the nature and complexity of the mortgage loans they work with.” It requires “periodic training be sufficient in frequency, timing, duration and content.”
So, weren’t depository institutions always training their MLOs? What’s different now? The BCFP (aka CFPB) specifically states:
“You must provide periodic training covering federal and state law requirements that apply to an individual’s loan origination activities. This training requirement applies to individual loan originators regardless of when you hired them. (§ 1026.36(f)(3)(iii)). You are required to provide training to your loan originator employees.”
Okay so the good news is, originators do not have to be provided training on requirements and standards that apply mortgage loans they do not originate, or on subjects about which they already have knowledge and skill. I wonder how the BCFP will assess “knowledge and skill? Does your company assess your originators? How often? What about changes to products, regulations and guidelines?
It also states that registered employers “may use NMLSR-approved licensed loan originator continuing-education training to satisfy the training requirement of this rule, to the extent that it covers the types of loans the individual loan originator originates and applicable federal and state laws and regulations. (See 12 CFR 1008.107(a)(2) for information about NMLSR continuing-education requirements.)
Providing the content is one thing. Keeping a system to demonstrate compliance is another thing. Without incurring the costs of recruiting, hiring, training the trainers and setting up a system to maintain records, how can depositories offer efficient compliant training?
YOUR solution! CLOES.online offers the periodic training, with the frequency, timing and duration for loan origination activities required under the rule.
We provide customized programs for your specific needs and record and maintain results, to provide you with timely reporting.
Since 1999, we have trained thousands of originators. Charter Oak Systems, LLC is an approved education provider with the NMLS, Provider # 1405047. We write, produce and instruct all our own content. We promise, you won’t get it anywhere else!
It’s worth a phone call to find out how to help you get ahead of your next audit. Call us today! (772) 228-6115 or email firstname.lastname@example.org.