FDIC on Originator Compensation

The FDIC recently indicated that it’s still seeing banks without written policies and procedures for compliance BSA Training and Banking Regulations Compliance Consulting diane11 - FDIC on Originator Compensationwith the Loan Originator Compensation Rule under §1026.36. This section requires written policies and procedures to help ensure compliance with the following items:

• Loan Originator Compensation restrictions;
• Steering Prohibitions;
• Loan Originator Qualification Requirements; and,
• Loan Originator Name and NMLS ID Disclosure requirements.

We want to remind you that every bank needs written policies and procedures for these requirements.  Some may be fairly short and to the point while others may be more complex. If you’re looking for a place to start, you can find sample templates on our Free Downloads page.

This section also requires banks to provide Loan Originator names and NMLS ID #’s on certain documents for closed-end loans secured by a dwelling.  The FDIC stated this is another requirement banks are missing. Currently, the names and NMLS ID#’s of the individual Loan Originator as well as the Loan Originator Organization must be provided on the following:

• Application;
• Note;
• Security Document; and,
• Integrated Disclosures (beginning August 1, 2015)

Now would be a good time to make sure you’re in line with these requirements before you next exam.

Published
2015/06/17
Diane Dean

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