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Question:

Does Georgia have specific requirements with regard to a mortgage loan originator (“MLO”) acting under Temporary Authority (“TA”)?

Answer:

Yes, effective January 9, 2020 the Georgia Department of Banking and Finance (the “Department”) requires the following with regard to Temporary Authority:

• All advertisements mentioning a MLO’s ability to act as an MLO in GA must “clearly and conspicuously” disclose that the MLO is operating under Temporary Authority in the state, is not currently licensed in GA, and has a pending application with the Department, which may be granted or denied.
• A MLO purporting to operate under the TA must indicate “TAO,” “temporary authority to operate,” or a substantially similar designation next to the signature line on any document, application, or disclosure signed by the MLO in connection with any residential mortgage loan application, including but not limited to the negotiation of terms or the offering of a loan.   
• Any MLO who qualifies to operate under TA must submit proof to the Department of enrollment in a class to satisfy GA’s MLO education requirements, as well as registering to take the test as required by C.G.A. § 7-1-1004(f). Such proof shall be submitted to the Department within thirty (30) days of receipt of the MLO’s application. 
• Mortgage companies must maintain in their journal of mortgage loan transactions clear identification regarding when any MLO utilizes TA at any point in the application or loan process, as well as the final status of the MLO’s GA license application.
• Requires mortgage lenders and brokers sponsoring MLOs operating under TA to provide a written disclosure in at least 10-point bold-faced type to an applicant on the date the applicant signs an application or any disclosure, whichever occurs first. The disclosure must be signed by the applicant and must include the following language:

“The Georgia Department of Banking and Finance requires that we inform you that our company is licensed but the mortgage loan originator responsible for your loan is not currently licensed by the Georgia Department of Banking and Finance. The mortgage loan originator has applied for a mortgage loan originator license with the Georgia Department of Banking and Finance. Federal law (12 U.S.C. § 5117) authorizes certain mortgage loan originators to operate on a temporary basis in the state of Georgia while their application is pending. The Georgia Department of Banking and Finance may grant or deny the license. Further, the Georgia Department of Banking and Finance may take administrative action against the mortgage loan originator that may prevent such individual from acting as a mortgage loan originator before your loan closes. In such case, our company could still act as your broker or lender.”

 

This disclosure provision becomes effective April 1, 2020.