Legal Article: This Legal Q&A is a must-read for all mortgage loan brokers.
During the subprime heyday of the mid-2000s, risky lending practices went
largely unregulated. Homeowners got into loans they ultimately could
not afford because of speculative borrowing, loose lending practices,
high-risk loan instruments, and mortgage fraud, among other things.
Not surprisingly in the subprime aftermath, both federal and state
authorities have implemented new laws regulating mortgage loan
activities. Most notable is the establishment of a nationwide
registry of mortgage loan originators (MLOs) under the landmark Secure and
Fair Enforcement for Mortgage Licensing Act of 2008 (SAFE Act).
This legal article addresses the federal and state components of the SAFE
Act as they affect California’s REALTORS®. Federal and state
authorities are expected to further develop and clarify the SAFE Act by
promulgating new rules, regulations, and policies in the near future.