Every home buyer and homeowner to whom I've posed the question of whether or not their mortgage Loan Officer (LO) was "licensed" has had no idea. The assumption by all of them, the general populace and even many real estate agents is that mortgage lenders, and specifically LO's, must SURELY be licensed. Right? Wrong!
In Arizona, only one person in any given firm must be licensed. So theoretically a mortgage lending firm could have one licensed individual broker and yet have a hundred LO's working in the firm ~ accessing confidential information on customers such as social security numbers, bank accounts, tax returns and credit reports, to name a few. So what's wrong with this?
In many cases, perhaps nothing. But in many cases, the abuses by LO's of their customers is staggering, costly and often even fraudulent. With licensing comes a measure of accountability. Without licensing, there's no way of having a clue of exactly how many unlicensed LO's are in Arizona, much less knowing anything about them or their backgrounds. So how does it make you feel to think your LO might have a criminal background? What if you discovered that your LO wasn't capable of passing a minimum mortgage finance exam? What if you found out that your LO didn't obtain the best loan rate and terms for your last home purchase but instead 'sold' you a loan that made her/him the most commission? And those types of questions just begin to scratch the surface.
So when I hear that House Bill 2320 has been introduced, a bill that would require mandatory licensing of ALL loan officers and originators, I want to shout hallelujah! We're way over due, and I support this measure 100%. The
Arizona Republic recently published an extensive article on the subject, which I encourage you to read in its entirety.
Thanks!
...randy
Labels: Arizona, broker, buyers, ethics, mortgage, real estate
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