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Financial Services Law Insights and Observations

Additional States Enact SAFE Act Legislation

State Issues

Recently, Alaska, Florida, Maine, and Tennessee each signed into law legislation designed to meet the mandate of the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 by providing for the licensing of mortgage loan originators under the Nationwide Mortgage Licensing System (NMLS). Alaska HB 221 authorizes participation in the NMLS and allows for emergency regulations to further implement the legislation. Among other items, Florida SB 2226Maine SB 523, and Tennessee SB 2279 each require mortgage loan originators to (i) submit to fingerprinting for the purpose of a criminal history background check, (ii) complete at least twenty hours of pre-licensing education, (iii) receive a passing score (i.e., 75%) on a qualified written test developed by the NMLS, and (iv) complete at least eight hours of continuing education annually. The Florida and Tennessee bills also amend certain definitions and licensing requirements applicable to mortgage lenders and mortgage brokers. Maine SB 523 also sets forth new requirements applicable to residential mortgage loans and higher-priced mortgage loans. Most provisions of Florida SB 2226 became effective July 1, 2009. The mortgage loan originator licensing provisions of Maine SB 523 become effective July 31, 2010. Most provisions of Tennessee SB 2279 become effective July 31, 2009. Alaska SB 221 is effective immediately.