1st Mortgage License/Registration FAQ

  • 1st Mortgage License/Registration

    Created 03/21/18

FAQ
When do I need to renew my 1st Mortgage License/Registration?

Your 1st Mortgage License/Registration expires December 31 of each year and must be renewed on or before December 15. You will receive renewal information from the Department of Insurance and Financial Services (DIFS) with instructions on how to renew. Renewal is requested and fees are paid directly through the Nationwide MultiState Licensing System & Registry (NMLS). All surety bonds, riders, etc. are submitted through the NMLS electronic bond function. Do not submit original surety bonds, riders, or continuation certificates directly to DIFS. Failure to timely renew may prevent you from conducting mortgage transactions in Michigan and may also result in late renewal penalty fees. (Section 7(1) and Section 8(7) of the Act).

What is a Mortgage Call Report (MCR), and when do we need to file it?

Licensees/registrants are required to file quarterly Mortgage Call Reports (MCR) through NMLS, which consists of the following components:

  • Residential Mortgage Loan Activity
  • Financial Condition

The MCR is a single report of condition that reflects the mortgage activity and financial information of a licensee/registrant with specific mortgage loan production information for each mortgage loan originator. Failure to file the MCR will result in the inability to request license/registration renewal. (Section 21(3) of the Act).

Do we have to file a Financial Statement?

Yes, you must file your financial statement no later than 90 days after the close of your fiscal year-end. For example, if your fiscal year-end is December 31, you must file the financial statement on or before March 31. This requirement can be met by filing the Annual Standard Financial Condition component of the NMLS Mortgage Call Report (MCR). Please note that all licensees/registrants are required to complete and file the Annual Standard Financial Condition. Failure to file your financial statement may result in fines and penalties. (Section 7(2) and 8(6) of the Act). Licensees/registrants are not required to submit audited financial statements; however, they must be completed in accordance with GAAP.

Is an Annual Report also required?

No. Beginning in 2018, licensees/registrants are not required to file an Annual Report on DIFS form FIS 1077 and/or form FIS 1080. Instead, all licensees/registrants are required to directly submit mortgage broker, lender, and/or servicer loan activity using the electronic Mortgage Call Report (MCR) filed quarterly via the Nationwide Multistate Licensing System & Registry (NMLS). Further information regarding the quarterly reports can be found at the NMLS Resource Center Mortgage Call Report. This activity will be used to assess the annual renewal operating fee. Late filing or failure to file may result in fines and penalties. (Section 21(3) and 8(6) of the Act).

Does Michigan utilize the Electronic Surety Bond (ESB) tracking in NMLS?

Yes. Beginning January 1, 2018, all new company license/registration applications will be required to meet all surety bond requirements by completing the electronic process. Current licensees/registrants must convert all existing surety bonds to NMLS via the submission of an ESB no later than December 31, 2018.

How do we report an Ownership Transfer?

Any transfer of 25% or more of a company’s shares or ownership is considered a transfer of the license. This action must have the Director’s consent prior to transfer. A registration is not transferable and requires the registrant to submit a new registration application. It is your responsibility to contact DIFS for information on transfers before the transaction consummation. (Section 9 of the Act).

We no longer want/need our 1st Mortgage License/Registration, what do we do?

If you go out of business or elect not to renew the license/registration, you should submit your surrender request directly through NMLS.

Submit the following document to DIFS:

  • Original license certificate
Do we need a separate license to originate mortgage loans?

Yes, a mortgage broker, lender, and/or servicer license or registration does not allow an individual to originate mortgage loans. Unless otherwise statutorily exempt, an individual (including an officer, director, member, shareholder, etc.) who originates mortgage loans is required to be licensed as a mortgage loan originator.

Are we responsible for maintaining our license/registration information in NMLS?

Yes, licensees/registrants are to regularly monitor their NMLS accounts for information accuracy and notify DIFS of any changes. Deficiencies set by NMLS or DIFS must be immediately addressed and resolved by the licensee/registrant.

Who do we contact for licensing issues?

If you have any questions regarding the above items, please contact the Consumer Finance Licensing Unit at 877-999-6442.

Who do we contact for compliance issues?

For information concerning compliance issues (e.g. maximum fees, record retention, prepayment penalty, RESPA, TILA and other compliance information), you should contact the Mortgage Examination and Investigation Section at 877-999-6442.

Does DIFS offer Mortgage Seminars?

Typically, DIFS offers an annual “Best Practices” mortgage seminar to licensees, registrants, and potential mortgage broker, lender, servicer and loan originator applicants. New licensees and registrants are strongly encouraged to attend. Please visit the DIFS website to view the next available seminar date and location.

How can we locate licensed Mortgage Companies?

You can view licensed entities and entity locations by visiting “Regulated Consumer Finance Entities” on the DIFS website.

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    The answers provided are not meant to be a substitute for legal advice.