Mortgage industry

HB 4204 requires mortgage servicers to send their Oregon borrowers a notice about temporary rights granted in the law as a result of the effects of the covid-19 outbreak. The notice must be sent by August 29, 2020. For more information and a sample notice, please click here.

The Division of Financial Regulation has regulatory authority over mortgage brokers, lenders, independent processor contractors, and mortgage loan originators conducting business in Oregon. Mortgage brokers and lenders are required to obtain a license as a mortgage lender in Oregon. Independent contractor processors and mortgage loan originators are required to obtain mortgage loan originator licenses. In order to take loan application or give mortgage advice, the division must have approved sponsorship of the mortgage loan originator license by the mortgage lender licensee. For more information, read our frequently asked questions and answers below.

How do I apply for a license?

Oregon uses the Nationwide Mortgage License System (NMLS) as part of company and loan originator licensing. Instructions on how to submit an application for Oregon, or any other state, are available on the NMLS website.

Where can I get a surety bond?

Contact your local insurance agent, who has access to the companies that are issuing Oregon Mortgage Lender Surety Bonds. Have the surety bond company use the Surety bond form - 440-2775.

What size surety bond does my company need?

Oregon has a bond requirement based upon the company's dollar volume of Oregon loan originations. If the company is a new licensee in Oregon, the company must provide a surety bond of $50,000. As part of the renewal of the license, the amount of the corporate surety bond will be calculated based on the dollar amount of Oregon residential mortgage loans listed in the mortgage call reports filed for the previous four quarters (Q2 + Q3 + Q4 of the previous year plus Q1 of the current year) using the following scale:

Volume of Oregon mortgage loan originations	Bond amount
Less than $10 million	$50,000
At least $10 million but less than $25 million	$75,000
At least $25 million but less than $50 million	$100,000
At least $50 million but less than $100 million	$150,000
More than $100 million	$200,000

Around the beginning of September each year, the Division of Financial Regulation will send a courtesy email to the company contact listed in NMLS of every company for whom the required bond amount is increasing. The email will notify them of the amount of surety bond required to be on file before the license can be renewed.

Will Oregon accept an irrevocable letter of credit rather than a surety bond?

If your company employs loan originators, we cannot accept an irrevocable letter of credit. Your company must obtain a surety bond as required by the scale. If your company does not employ loan originators, you may use an irrevocable letter of credit matching the scaled requirements for a surety bond.

My company is exempt from licensing. Can we provide a surety bond to cover our loan originators?

Yes. The company may provide the bond according to the posted scale to cover all the company's loan originators. If the company does not do this, then each licensed loan originator working for that company must individually provide a bond based upon the scale using the dollar volume of the Oregon loans originated by that loan originator.

What do I need to send in outside of the NMLS to change my company's address?

Oregon does not require any documents outside of the NMLS for this. File an amended MU1 to change the address of the company's principal location or an amended MU3 to change the location of a branch.

I have a deficiency to respond to another state's denial, suspension, or revocation of my license, but my license is now fully approved in the other state. Do I still have to respond to the deficiency?

Yes. Unless the other state has provided external notes in the NMLS that indicate that the denial, revocation, or suspension was in error, you must provide in NMLS either 1) written confirmation from the other state that the action was in error or 2) a letter of explanation regarding the license action and a copy of the letter, order, or other notification from the state regarding the license action. The letter of explanation should explain why the other state took action on your license and your explanation of the events from your point of view. If the other state has provided external notes in NMLS that indicate that the denial, revocation, or suspension was in error, inform the person who placed the deficiency that the matter has been resolved and there are notes in NMLS so that we can check as we do not receive notice when those notes are placed.

How soon should I notify the state of any change of name, address, contact person, etc.?

Companies must notify the division within 30 days following any change to the information contained in the MU1, MU2 or MU3 application.

I filed an amendment in the NMLS changing our company's address, email, and other contact information. Do I need to provide written notice of any change to the state also?

Filing an amendment in NMLS is considered the notice of the change to the division. You do not also need to send a notice outside of the NMLS unless we specifically direct you to do so.

What advertising rules apply to mortgage lenders?

Advertising by mortgage lenders is governed by both federal and state rules. The federal Truth in Lending Act dedicates an entire section to advertising consumer credit.

The two most common violations of the Truth in Lending Act are advertising a note rate without the annual percentage rate and using a trigger term, such as the amount of the down payment, without the required disclosures.

Oregon also has several Oregon Administrative Rules on advertising, governing everything from what ads can and cannot promise to what direct-mail pieces should look like.