This month we provide a brief overview of two recent acts which impact the real estate industry: (1) the SAFE Act which must be complied with by January 1, 2011, and (2) HAFA which was recently enacted.
THE SECURE AND FAIR ENFORCEMENT MORTGAGE LICENSING ACT OF 2008
The Secure and Fair Enforcement Mortgage Licensing Act of 2008 (“SAFE Act”) became federal law on July 30, 2008, and California law in October 2009. The California law requires all DRE real estate licensees who conduct residential mortgage loan originator (MLO) activities to meet certain requirements to qualify for a MLO real estate license endorsement by January 1, 2011. The SAFE Act requires completion of 20 hours of pre-licensing education and passing a written qualified test. Currently licensed MLOs must pass both the National component and the California State component of the examination with a test score of not less than 75 percent. Existing MLOs must pass the National and the State component by September 15, 2010 in order to be issued an MLO license endorsement by January 1, 2011.
Besides passing the written qualified test, the SAFE Act requires licensees to submit a set of fingerprints and to pay a $39.00 fee to have a criminal background check performed. Furthermore, MLOs must demonstrate financial responsibility by authorizing a credit report to be obtained. Finally, MLO endorsements will be issued annually and will expire each year on December 31st. A licensee must complete 8 hours of continuing education each year to renew his or her license.