The Conference of State Bank Supervisors (CSBS) and the American Association of Residential Mortgage Regulators (AARMR) have launched the National Mortgage Licensing System, an Internet-based system that will serve as the foundation of a coordinated state mortgage regulatory framework.
NMLS, which is modeled upon the registry used to regulate securities brokers and dealers, has seven states as initial participants: Idaho, Iowa, Kentucky, Massachusetts, Nebraska, New York and Rhode Island. Eventually, CSBS expects all 50 states will transition onto the system.
According to CSBS, system participants say joining NMLS will help improve the efficiency and effectiveness of state supervision of the mortgage industry, enhance consumer protection, fight mortgage fraud and predatory lending, increase accountability among mortgage industry professionals, and unify and streamline state license processes for mortgage lenders and mortgage brokers.
In addition, plans call for consumers to have access to the system's public licensing and enforcement information in 2009, enabling them to make more informed decisions when selecting mortgage loan officers and lenders.
