South Carolina splits mortgage oversight in two. Companies that make or service loans fall under one chapter of state law, companies that arrange them fall under another, and a different agency runs each. Banks sit outside both.
| Mortgage lender | Mortgage broker | |
|---|---|---|
| Law | Mortgage Lending Act, S.C. Code Title 37, Chapter 22 | Licensing of Mortgage Brokers Act, Title 40, Chapter 58 |
| What it does | Makes or services a mortgage loan | Solicits, processes, places or negotiates a loan for a borrower with a lender |
| Licensed by | The commissioner designated by the State Board of Financial Institutions | The Administrator of the Department of Consumer Affairs |
| Loan originators | Individually licensed, one employer at a time | Individually licensed, one employer at a time |
Under both chapters it is unlawful to do the business, or even advertise it, without the license. Independent contractors, including processors and underwriters, must be licensed separately.
A depository institution regulated by a federal banking agency is an exempt person, along with its wholly owned subsidiaries and their employees acting in that job. That is why a bank or credit union loan officer is federally registered and not state licensed. It does not mean nobody supervises them. It means the supervisor is federal.
After taking your application, a broker must give you a mortgage broker fee agreement that discloses the total estimated charges.
The agreement must say the broker is acting as the agent of the borrower, and owes a duty of utmost care, honesty and loyalty, including full disclosure of all material facts.
Brokers post a bond of at least $25,000, rising with loan volume, for consumers who have losses from a broker's noncompliance.
Both agencies take part in the Nationwide Mortgage Licensing System. Search the company name or NMLS number at NMLS Consumer Access and you will see each state license, its status and any public regulatory action. Home Loans Inc is NMLS #1728740. Once you know who you are dealing with, South Carolina borrower protections covers what the loan itself may and may not contain.
Source: S.C. Code 37-22-110, 37-22-120, 37-22-270; 40-58-10, 40-58-30, 40-58-40, 40-58-75, 40-58-78. General information, not legal or tax advice.
Home Loans Inc is a South Carolina mortgage broker in North Charleston. One application, priced across many wholesale lenders, with a person who answers the phone.