A dual-licensed professional works as both an MLO and a real estate agent. When originating a mortgage for a client where they also represented the buyer in the real estate transaction, they receive their normal MLO compensation plus a real estate commission. This dual compensation is:
Correct Answer
B) Permitted if both compensations are disclosed to the borrower
Dodd-Frank does not prohibit dual compensation for legitimately separate services, but requires full disclosure of all compensation sources. The key is that each compensation must be for distinct, legitimate services provided to the borrower.
Why This Is the Correct Answer
Dodd-Frank does not prohibit dual compensation for legitimately separate services, but requires full disclosure of all compensation sources. The key is that each compensation must be for distinct, legitimate services provided to the borrower.
More Origination Questions
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For a construction-to-permanent loan, when must the initial Closing Disclosure be provided for the construction phase?
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