An employee acts as a mortgage loan originator for a national bank on nine residential mortgage loans in a 12-month period. Which SAFE registration or licensing route applies to that bank employment?
Correct Answer
D) She must use federal NMLSR registration for this covered national-bank MLO employment
D. Federal registration applies to this national-bank MLO role. National banks and their employees acting as MLOs are within Regulation G. Nine residential mortgage loans exceeds the limited five-or-fewer exception. Registration is required before activity exceeding that exception. Scope and exceptions: The exception applies only to someone never previously registered or licensed through the Registry. Federal registration requires a unique identifier and ongoing maintenance, not merely a bank job title. Different employment or activities require a new coverage analysis. Source: Section 1007.101(c)(1)(i), (c)(2) — https://www.consumerfinance.gov/rules-policy/regulations/1007/101/ Section 1007.103(a)(1)–(2), (b) — https://www.consumerfinance.gov/rules-policy/regulations/1007/103/
Why This Is the Correct Answer
D. Federal registration applies to this national-bank MLO role. National banks and their employees acting as MLOs are within Regulation G. Nine residential mortgage loans exceeds the limited five-or-fewer exception. Registration is required before activity exceeding that exception. Scope and exceptions: The exception applies only to someone never previously registered or licensed through the Registry. Federal registration requires a unique identifier and ongoing maintenance, not merely a bank job title. Different employment or activities require a new coverage analysis.
Why the Other Options Are Wrong
Option A: She registers with the NMLSR only if she takes more than 25 applications
The rule does not establish a 25-application threshold.
Option B: She must obtain a state license in the usual way, as any other originator does
It substitutes the state-licensing route for the federal route applicable here.
Option C: She needs neither, because 9 applications is below the de minimis floor
Nine exceeds five, and the exception has additional eligibility conditions.
Exam Tip
Determine employer coverage first; then test the narrow activity exception.
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