BOSTON – The state Department of Banking told a credit union-owned mortgage lender in a new legal opinion its mortgage officers must obtain state licenses under the SAFE Act.
The banking department told Central One FCU in Shrewsbury, Mass., which owns 95% of Alcorn Allocations LLC, that neither NCUA nor the banking department have legal authority over the CUSO, therefore it is required to register with the state regulator as a mortgage broker and have all of its lenders are subject to licensing requirements under the new law.
The new law also requires all mortgage lenders at federally insured credit unions and banks to register with the department, a less stringent requirement.
“This is pretty consistent with what NCUA is telling people,” said Katherine Webber, a Philadelphia lawyer with the CUSO experts Messick and Webber. “NCUA has always taken the position that they don’t regulate CUSOs, that they’re regulated by whatever agency that oversees their activity.”
