State urges mortgage lenders to move quickly on registry

Nevada regulators are encouraging mortgage loan officers and the companies that employ them to move quickly once the state mandates use of a national registry of mortgage lenders.

The State Mortgage Lending Division will put the Nationwide Mortgage Licensing System & Registry into place on Oct. 1, and mortgage loan officers will have a deadline of Nov. 12 to complete their registration.

But here's the potentially worrisome issue: As part of the registration process, mortgage officers will need to pass a federal test of their knowledge.

If they fail to pass, they won't be able to take the test again for 30 days. In other states that have transitioned to the national registry, about a third of mortgage officers have failed the test on their first try.

That means a loan officer who failed the test on Oct. 15 would not be able to complete registration before the Nov. 12 deadline. Agents who fail the test four times must wait six months before retaking it.

New mortgage loan officers also will need to take a Nevada state test. People who already have passed the state test won't be required to take it again.

The new registry, which has been rolling out across the nation since 2008, allows consumers to go to a single database to learn about the licensing of a mortgage loan officer.

Joseph Waltuch, commissioner of the Mortgage Lending Division, says it also will prevent loan officers who lose their license in one state from easily setting up shop in another.

While the national registration includes much of the information that's required for a mortgage loan officer to be licensed in Nevada, it doesn't replace the requirement for a state license, says Sheila Walther, supervisory examiner for the Mortgage Lending Division.

Nevada licensing requires several provisions no arrears in child-support payments, for instance that aren't addressed in the national registry.

The registry's operation in Nevada arrives at a time that the number of mortgage loan officers is down dramatically from its peak four years ago.

In 2006, the state was home to about 12,500 licensed mortgage offices. Today, about 2,300 remain.

Participation in the national registry also is required for each of the 300 mortgage companies that operate in the state.

For many of those companies, Walther says the registry may ease some paperwork burdens because they'll be able to submit a single form covering their operations in multiple states.

A telephone help desk will be available to walk loan officers and mortgage company executives through the registration. The number is (240) 386-4444.