The Ohio Mortgage Broker Act defines the role of a mortgage broker in the State of Ohio and establishes requirements for obtaining a mortgage broker’s license. Prior to obtaining their license, prospective mortgage brokers must fulfill requirements including prior experience in the field, and upon receiving the license they must register it with the Ohio Department of Commerce. Additionally, the Act states that licensed mortgage brokers must continue their education periodically.
The Facts
Under the terms of the Ohio Mortgage Broker Act, mortgage brokers perform one or all of several roles: providing potential buyers with the information that they need to purchase the property, providing the lien for a residential mortgage, and “brokering” the loan between the buyer and the lender. The Ohio Mortgage Broker Act also defines the roles of other participants in the real estate transaction, including buyers and loan originators.
The Requirements
The Ohio Mortgage Broker Act sets standards and qualifications for those in the profession. The initial requirement is three years of experience working in real estate mortgage financing. Once these three years are completed, the broker candidate must fill out an application and obtain a surety bond (for $50,000, as of 2010). Fingerprinting and a background check follow. All brokers must complete annual training to renew their licenses and provide photographic proof that they are maintaining a business location in Ohio.
Additions
In addition to complying with the requirements of the Ohio Mortgage Broker Act, mortgage brokers in Ohio must also show proof of compliance with the Ohio Home Ownership and Equity Protection Act (Sections 1349.25-1349.44), which sets forth the legal protections for real estate purchasers.
Benefits
The Ohio Mortgage Broker Act is designed to protect all parties involved in a real estate transaction. With the strict licensing requirements, the Act ensures that brokers will be well trained and will know how to avoid the fraud and corruption that can occur in the real estate business. For example, the act notes that all fees must be stated clearly and that mortgage brokers may not accept any extra fees to facilitate the transaction.
Considerations
The Ohio Department of Commerce reviews all applications for mortgage broker licenses carefully and reserves the right to reject any applicant if he or she does not meet the stated requirements. Accordingly, applicants should research all requirements carefully before applying to ensure that the application stands the best possible chance of acceptance.
