Safe FAQ Credit Report and Financial Responsibility
Revised 07/2018
Department of Real Estate
SAFE ACT ¨C Frequently Asked Questions
What can you tell me about the Credit Report
and Financial Responsibility Requirement?
Q. Will DRE be using FICO scores in making a determination on whether a MLO license endorsement
applicant has meet the SAFE Act financial responsibility requirement?
A. No.
Q. I have had a bankruptcy, foreclosure, or other credit issues which have had a negative effect on my
credit score. Will I qualify for a mortgage loan originator endorsement?
A. An applicant may be precluded from obtaining a mortgage loan originator license endorsement where
his or her personal history includes any liens or judgments for fraud, misrepresentation, dishonest dealing,
and/or mishandling of trust funds, or other liens, judgments, or financial or professional conditions that
indicate a pattern of dishonesty on the part of the applicant. DRE has adopted Regulations which address
this topic.
As noted above, though, an applicant¡¯s credit score or FICO score is not used in this determination. Many
factors that do not reflect on an applicant¡¯s honesty or professional responsibility may have impacts on
his or her credit score, so that number is not useful for this screening purpose.
Much has been made about the SAFE Act¡¯s authorization of licensing agencies to use credit reports with
regard to screening MLO license applicants. It is important for applicants to understand that DRE will
only use credit reports (not credit scores or FICO scores) for the information these reports contain that
can verify or refute each applicant¡¯s statements in response to questions about financial history that appear
on the MLO license endorsement applications. Applications for a MLO license endorsement will be
reviewed individually and an individual determination will be made if any financial responsibility issues
are identified.
Q. How does the credit report authorization process work?
A. NMLS enables an individual to authorize a credit report through NMLS. All DRE MLO license
endorsement applicants will be required to complete the credit report authorization process through
NMLS.
Information regarding the credit report authorization process is available on the NMLS Resource Center
Web site.
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