JSMedia – The Financial Crimes Enforcement Network recently released its final rule requiring non-bank residential mortgage lenders to establish a written anti-money laundering program and file suspicious activity reports. The new rules are meant to cover most non-bank mortgage lenders, including nonprofit housing organizations. As such, they are likely to affect many non-bank mortgage originators. But, before the new rules go into effect, there are some things you can do to make sure you’re compliant.
The first rule requires RMLOs to have a compliance program. However, the final rule also extends the new requirement to Freddie Mac, Fannie Mae, and Federal Home Loan Banks. As of now, there are no requirements requiring RMLOs to have an AML/CFT program, but they need to develop one in the near future.
The new rules will also apply to non-bank mortgage lenders. The current AML/CFT rules do not apply to traditional mortgage servicers. These businesses do not offer mortgage loans. FinCEN views servicers as businesses that support post-origination principal collection. Nevertheless, they are likely to fall under the definition of a residential mortgage originator in the final rule.
Non-Bank Mortgage Lenders: Preparing for New AML Rules
AML program requirements are more extensive than the current AML guidelines for banks. RMLOs should develop a written AML program and submit copies of the results of independent testing to banks. Protiviti’s AML and compliance team understands the AML rules and the mortgage loan origination industry. They help financial institutions with their AML risk assessments, suspicious activity monitoring process development, and enforcement action remediation.
As a Non-Bank Mortgage Lender, you must ensure that you comply with the AML regulations for residential mortgage lending companies. Your AML program must be effective and up-to-date. By implementing an AML program, you’ll be prepared to comply with the new AML laws. In addition to the new AML rules, your RMLO should follow the guidelines in the RMLO’s market.
The new AML rules also require debt buyers and debt collectors to submit a separate application. The changes make it mandatory to disclose any payments received from non-bank entities. RM Originators are required to comply with the requirements, and this requirement is not a new requirement. They must have the same policies as banks and have the same procedures. As a result, they need to create an AML program that matches the new requirements.
For non-bank mortgage lenders, the new rules will require them to establish an AML program. It will be necessary to implement a robust AML program that addresses the needs of their clients. The rules will also impose additional requirements on debt buyers and debt collectors. These changes will make RMLOs more responsible for their lending operations and ensure that their customers are protected.
The Volcker Rule applies to community banks and savings associations. It simplifies the capital regime for community banks. It also allows well-managed, smaller financial institutions to apply for a simplified call report. Rural areas are exempt from appraisal requirements and greater protections for military servicemembers and veterans. This rule will affect mortgage loans and mortgage loan servicers. These changes will affect every non-bank lender, but it will also affect smaller companies.
The new regulations will affect all kinds of non-bank mortgage lenders. The proposed rules are designed to provide a level playing field for all types of companies. Despite the new rules, they may also pose additional challenges for the non-bank industry. The Volcker Rule has the ability to simplify the capital regime for community banks. Currently, it applies to savings associations and community banks.
AML Rules affect the way that lenders manage the transactions of their loans. For example, if a lender cannot sell a loan to a non-bank buyer, it won’t bother doing business with the lender. This will affect the quality of the non-bank mortgage loan, which is crucial for the industry. The new AML rules will impact the way that the lending industry handles its funds.