Who Regulates Mortgage Companies?

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Mortgage companies are regulated by the federal government and through state policies. Find out how a state can regulate who makes loans with help from a financial specialist in this free video on mortgage assistance and personal finance.

Part of the Video Series: Mortgage Assistance
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Video Transcript

Hi, this is Matthew McKillen with Innovative Financial Group. The question posed to me today is who regulates mortgage companies? It's really regulated on two levels, superseding everything, the federal government has their hands quite a bit on the mortgage lending policies. And a lot of it is governed through HUD one of the major policies that they regulate is what's called RASPA, and that's the proper disclosure to a homeowner or to a purchaser of a property of how the loan works, what their annual percentage rate is going to be, if it's a refinance they have to be given the ability to rescind the loan within three days after signing the paperwork. All of that comes down from the federal level. Secondly, the states also have policies regarding who can make loans. For example in Florida, you do have to be a licensed mortgage broker and pass an exam with the state of Florida in order to arrange mortgages. Now if you do work for a mortgage lender, not a broker, you're actually a salaried employee, W2 employee form lender, you don't fall under the same guidelines but any lender or mortgage company in the state of Florida is still subject to audits and there is certain documentation that we provide on our loans that are separate from other states. So again it's the federal level and the state level that regulates all the mortgage lending practices. My name is Matt McKillen and I'm with the Innovative Financial Group.

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