Mortgage Compliance: What You Need to Know

Ensuring marketing compliance in today’s regulatory environment is critical for any mortgage company.

In this blog post, we’ll cover the basics of mortgage compliance, why it’s important, and how to mitigate compliance risk across consumer marketing channels.

Table of Contents

What regulations impact the mortgage industry?

There are several regulations that impact the mortgage industry, including the Truth in Lending Act (TILA), the Real Estate Settlement Procedures Act (RESPA), and the Home Mortgage Disclosure Act (HMDA). 

TILA requires lenders to disclose key terms and costs of a mortgage to borrowers, while RESPA regulates the process of closing a mortgage and requires lenders to provide borrowers with information about settlement costs. 

HMDA requires lenders to collect and report information about mortgage applications and loans to promote fair lending practices.

How can mortgage companies monitor for state-specific mortgage regulations?

To monitor for state-specific mortgage regulations, mortgage companies can review the state’s regulatory agency website for updates on laws, rules, and guidance related to the mortgage industry. 

They can also subscribe to industry publications that cover state-level regulatory developments, and participate in industry groups and associations that provide updates and guidance on state-specific regulatory compliance issues. 

Additionally, working with legal and compliance experts who have experience and expertise in state-specific mortgage regulations can provide valuable insights and guidance.

How do financial institutions monitor and track loan officers’ marketing activities and ensure that they are meeting regulatory requirements?

Financial institutions can monitor and track loan officers’ marketing by first requiring loan officers to submit marketing materials for review and approval before use. 

After initial approval, organizations can utilize compliance monitoring technology to monitor loan officers’ marketing practices across the web and social media. 

Financial institutions can also provide training and education to loan officers to ensure they are aware of and understand the regulatory requirements related to marketing activities.

How do mortgage lenders stay up-to-date on the latest regulatory compliance requirements and changes in the mortgage industry?

Mortgage lenders stay up-to-date on the latest regulatory compliance requirements and changes in the mortgage industry through a variety of methods, including

• Monitoring regulatory agencies and news sources
• Participating in industry groups and associations
• Conducting regular risk assessments
• Investing in training and education
• Working with external legal and compliance expert

What compliance risks do loan officers pose to mortgage companies?

Loan officers can pose several compliance risks to mortgage companies. 

First, loan officers who use social media may violate marketing and advertising regulations or engage in conduct that violates fair lending or privacy laws.

Second, if loan officers use unknown vanity URLs that are not approved or tracked by the mortgage company, they may be engaging in unapproved marketing activities that could expose the company to compliance risks. 

How do financial institutions ensure that loan officers are providing all required disclosures to customers as per the regulations?

Financial institutions ensure loan officers are providing all required disclosures to customers by implementing robust compliance management systems, conducting training sessions, performing audits, and using compliance technology solutions. 

These methods help to ensure that loan officers understand the regulations and requirements and are able to properly disclose information to customers. Regular monitoring and auditing also help to identify any potential issues and ensure that all required disclosures are being made to customers.

PerformLine: The Trusted Platform for Mortgage Compliance

PerformLine’s omni-channel compliance monitoring solution was built to automate the monitoring and remediation of regulatory and brand compliance violations, on all internal and external channels including web, messaging, calls, email, documents, and social media. Our turn-key industry rulebooks are built on years of experience working with regulators and industry clients.

Speak to one of our experts today to learn more about mitigating loan officer risk and ensuring brand safety.