Can I originate an FHA loan if I am licensed in other Real Estate Oriented professions?
For the longest time, the government has made continual changes to the policies and procedures of all different aspect of the lending world. Two of the biggest questions I get asked by Realtors, Title agents, and insurance agents are “can we become an MLO and is it worth it since they don’t allow us to originate FHA loans and hold other professional licenses?” This was true for a while, but to get the final word on whether this had changed, I sent an email to the HOC (Home Ownership Center) in Atlanta.
Here’s what I asked:
“Have they lifted the ruling that a licensed real estate agent, insurance agent or title agent cannot be involved in the Brokering/Origination of an FHA Loan? My understanding was that you cannot be an active licensee (mortgage/title/insurance) and work on FHA Loans but it was brought to my attention that the policy might have changed. Where would I verify the actual policy?”
HUD’s Response was the following:
“Since HUD no longer approves brokers or loan correspondents – that rule only applies to HUD approved / retail Originations – it is up to DE lenders who utilize TPO( third party originations/originators) to set their internal guidelines as to whether they will allow it- they can subject to of course the laws of the state the loan is originated in.”
To sum this up in plain English, the policy to allow those holding other professional licenses to work on FHA loans has been left up to the third party lender originating the loan. So, if the lender you are selling the loan to is OK with it so is FHA.