MD Commissioner of Financial Regulation News
Deputy Commissioner for Financial Regulation Testifies Before Congress on Behalf of Conference of State Bank Supervisors
WASHINGTON, D.C. (July 14, 2011) - Anne Balcer Norton, Deputy Commissioner of the Maryland Department of Labor's Division of Financial Regulation, testified yesterday on behalf of the Conference of State Bank Supervisors (CSBS) before the Insurance, Housing, and Community Opportunity Subcommittee of the House Financial Services Committee. The hearing was entitled "Mortgage Origination: The Impact of Recent Changes on Homeowners and Businesses," and was held by Chairman Judy Biggert (R-IL) and Ranking Member Luis V. Gutierrez (D-IL).
Norton detailed efforts by state regulators to improve and enhance mortgage regulation to better protect consumers and to strengthen the mortgage market itself, but also to ensure a diverse mortgage industry which supports a variety of business models. In her testimony, Norton discussed changes and improvements made to mortgage supervision over the past few years and acknowledged the policy and regulatory response to the recent financial crisis remains a work in progress. Norton discussed state efforts to establish a new framework of mortgage supervision through the development and launch of the Nationwide Mortgage Licensing System and Registry (NMLS). She also credited Congress for codifying NMLS into federal law by enacting the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (SAFE Act), thereby creating an integrated and comprehensive state-federal approach to mortgage supervision.
"NMLS was conceptualized and created by state regulators to unify state mortgage supervision in a single framework," Norton said. "NMLS provides the foundation for coordinated, consistent, and comprehensive supervision of the mortgage industry. The challenge for policymakers-and for the regulators who implement these policies-is to create a regulatory framework that ensures industry professionalism and accountability. We must also avoid unnecessary regulatory inefficiencies and burdens. For state regulators, policies and approaches that encourage regulatory collaboration and coordination and that support regulatory innovation have been vital to striking this balance."
During her testimony, Norton pointed to Maryland's proactive leadership to prevent foreclosure and protect homeowners' rights. Maryland completed its transition to the NMLS in December 2010. More than 5,100 individual mortgage loan originators and 1,300 mortgage companies are currently licensed through the NMLS.
Under Governor Martin O'Malley's leadership, Maryland has passed a series of legislative and regulatory reforms that ban prepayment penalties, assure a borrower's ability to repay a mortgage loan and verify sources of incomes, require a tangible net benefit in refinance transactions, require disclosure on first lien loans to provide borrowers with a notice of housing counseling or homebuyer education and implement a duty of good faith and fair dealing by mortgage professionals. During the 2011 legislative session, the Maryland General Assembly passed legislation amending existing reforms that give the Commissioner of Financial Regulation authority to issue summary orders directing lenders to cease and desist from engaging in alleged violations of state's criminal mortgage fraud statute and provide the alleged offender with an opportunity for a hearing.
To read Deputy Commissioner Norton's testimony please click here.