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Loan Originator Compensation Rules

Recorded on November 14, 2013

Several separate rulemakings have addressed loan originator compensation under Regulation Z, and new tweaks to the rule on this subject have been adopted as recently as September 13, 2013. It's a hot topic, and it's an area you don't want to screw up.

You have to be able to definitively determine who is subject to the compensation restrictions, what types of loans carry with them the prohibition against LO compensation being tied to rates and terms. (And don't confuse Mortgage Loan Originators under the SAFE Act with loan originators for Reg Z comp purposes. Totally different triggers for the two! It's possible for someone to be an LO but not an MLO and vice versa.) How can you construct bonuses for those who are covered? What can you contribute to a deferred compensation plan for them? What compensation structures are permissible - and which ones will get you in regulatory hot water?

From issues relating to dual compensation, mortgage brokers, and timing considerations, there is a great deal to wrap your head around. And, as you might expect, detailed new record retention requirements to boot.

We will start with the basics of loan originator compensation and follow through with ideas on practical application. After this program, you will be prepared to review your LO compensation structure for compliance and rework it, if necessary to ensure it conforms to the new rules.

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