From the Desk of the Om-Bobs-man

From the Desk of the ‘Om-Bobs-man’ "Om-Bobs-Man" is the nickname Bob Niemi earned while serving as the NMLS Ombudsman in 2014 and 2015. Bob is a former Ohio state regulator and now an expert consultant on NMLS and state regulatory matters. Bob can be reached at BNiemi@Bradley.com.

You’ve Got to Fight for Your Regulator

The 2020 NMLS Annual Conference took place in mid-February with record attendance in San Francisco. The featured sessions were Networked Supervision, State Examination System, Licensing, Temporary Authority and the Ombudsman Meeting.

The one topic on everyone’s mind was the re-engagement for the NMLS. A new ‘modernized’ NMLS will be developed with data driven and intuitive functions, but also a phased implementation plan. The modernized NMLS is founded in Networked Supervision, where a core-state reviews the common license requirements. Then state specific requirements are reviewed prior to approval in each subsequent state. The concept has been utilized in the money services business and will be phased in money services prior to mortgage licensing.

The State Examination System, or SES, received positive reports from regulators and industry users during the fall pilot. The SES will allow regulators to maintain oversight while making the process more efficient by using a single system for the industry and regulators during exams. A single technology platform provides this collaboration between states and the industry as well as additional state acceptance. The outstanding question will be the adoption of consistent policies to utilize the SES efficiently and state willingness to accept completed exams.

Licensing sessions covered a deeper discussion on Networked Supervision, though state policy and process are still in development. Another panel discussed current branch licensing and cloud-based originations systems. The session featured good interaction on how regulators can keep pace but also how better to supervise a lender today. The session also reviewed how the streamlined branch licensing would be implemented with networked supervision.

The Temporary Authority (TA) Panel shared an update on the utilization of the new authority. The session shared that of the 44,458 MLO applications, over 21,000 were eligible, while almost one-third required some additional background review. The session also covered reporting and enhancements that should be released in April.

The Ombudsman meeting was highlighted by discussions on TA, Mortgage Call Reports, and expiration of the ombudsman’s term. I submitted a letter for the creation of a regulatory tracker of the overlays made by states when implementing Temporary Authority, which would provide direct links on the TA Resource Page to state rules or regulations.

Kobie Pruitt of the MBA reviewed some of the modifications made to implement TA. He also questioned the Georgia TA disclosure and lack of inclusion regarding consumer access. He also advocated for similar authority when moving from licensed mortgage companies within the same state.

Rich Cortes from Connecticut and chair of the MCR working group requested that the latest update to the Mortgage Call Report be implemented as soon as possible. The revision has been delayed for NMLS2.0 but cannot be delayed any longer. This will provide required financial information and reduce burden on smaller- and medium-sized mortgage companies.

Last, Scott Corscadden became the first ombudsman to complete the four-year term. He received a standing ovation for his service from both the industry and regulators. Now the search for a new ombudsman begins. MBM

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