Department of Financial Institutions
DFI Recognizes the Anniversary of the Mortgage Licensing System
FRANKFORT, Ky. – Jan. 13, 2009 – One year ago, Kentucky was one of the first states to join the Nationwide Mortgage Licensing System (NMLS). Today, the Kentucky Department of Financial Institutions (DFI), the state mortgage regulator, continues to be at the forefront of improving mortgage regulation.
The Web-based licensing system began operations in January 2008, increasing efficiency in mortgage regulation and enforcement. Today there are 22 states participating, and an additional 25 states have indicated their intent to enroll.
NMLS uses a single set of uniform applications to allow state-licensed mortgage lenders, mortgage brokers and loan officers to apply for, amend, update or renew a license online for all participating state agencies. In 2008, Kentucky processed applications from 553 companies and 3,142 individuals through NMLS. Nationally, the system has registered over 42,000 individuals and 8,600 companies.
“Kentucky is leading the way in improving mortgage regulation,” said DFI Commissioner Charles Vice. “Utilizing NMLS, along with implementing the provisions passed in House Bill 552 during the 2008 General Assembly session, has helped promote stable markets in this state and has increased protection for Kentucky consumers.”
NMLS allows DFI to quickly identify and halt illegal mortgage lending activities. The system’s thorough tracking and licensing ensures that a company hires only registered loan officers and that loan officers are working for licensed companies. As a result, loan officers issuing mortgage loans in Kentucky meet the state’s high standards and have the required education each year to remain in the business.
“The NMLS has proven to be an effective and efficient regulation tool, and it also has streamlined the registration process for many of our licensees,” said Kathy Stewart, director of DFI’s Financial Institutions Division. “DFI is committed to protecting consumers from mortgage fraud and to holding mortgage companies and professionals accountable.”
Last summer, the U.S. Congress recognized the importance of the NMLS by including it in federal law. The S.A.F.E. Act, which is part of Title V of the Housing and Economic Recovery Act of 2008, mandates that all mortgage loan originators must be either federally registered or state-licensed through the NMLS.
For more information on the federal S.A.F.E. Act, visit www.csbs.org/AM/Template.cfm?Section=SAFE_Act.
For more information on NMLS, visit www.stateregulatoryregistry.com/nmls or www.kfi.ky.gov.
Before signing mortgage loan documents, Kentucky borrowers can contact DFI to check the license or registration and complaint history of their lender. There is an entity search online at www.kfi.ky.gov/search, or consumers may call 800-223-2579.
DFI is an agency in the Public Protection Cabinet. It supervises the financial services industry by examining, chartering, licensing and registering various financial institutions, securities firms and professionals operating in Kentucky. DFI’s mission is to serve Kentucky residents by maintaining a stable financial industry, continuing effective and efficient regulatory oversight, promoting consumer confidence, and encouraging economic opportunities.