It appears that some of the wirehouses are misinterpreting the guidelines regulating the S.A.F.E. Act of 2008, resulting in negative effects on the careers of some Financial Advisors. As financial recruiters, Willis-Consulting is aware of these issues, and encourage any FA’s who are being effected to contact us for more information and advice. As a background to this issue, please read on…
The S.A.F.E. Mortgage Licensing Act, or Secure and Fair Enforcement for Mortgage Licensing Act of 2008, created a nationwide mortgage licensing database that provided for minimum federal regulations for those who write mortgage loans. The act compels those who write loans to submit to education, testing and background checks to ensure their suitability to provide this service. As a part of the Housing and Economic Recovery Act, each state was required to create its own law to comply with the S.A.F.E. Act. .
The S.A.F.E. Act sets requirements for both individual mortgage loan originators and institutions regulated by the mortgage industry. To be eligible for registration under the S.A.F.E. Act, loan originators are required by the federal government to take at least 20 hours of classes at an institution licensed to teach it. In some states they may be required to take up to five hours of additional education, based on their state’s standards. They must pass both a federal test and a state test. Each state has its own testing requirements; some states allow loan originators who move into their state to submit a passed test in their previous state in lieu of a new state test. Once a license is obtained, under the S.A.F.E. Act the loan originator must complete eight hours of continuing education per year.
Another critical component of the S.A.F.E. Act is a credit and criminal background check for all loan originators. A loan originator may not obtain a license if he has ever had his license revoked or has ever been convicted of financial crimes like fraud or money laundering.
Individuals who are registered under the S.A.F.E. Act must maintain that registration as long as they are loan originators. That includes their unique identification number, which remains with them even if they change companies. Agencies are required to comply with the S.A.F.E. Act and only employ those who are fully registered.
For more information, contact us at: 480-361-9490.
Patrick Kelly