I posted this in the LO Comp forum in August.
http://www.bankersonline.com/forum/ubbthreads.php?ubb=showflat&Number=1846114Post 1847623
1026.36(f)(3) For each of its individual loan originator employees who is not required to be licensed and is not licensed as a loan originator pursuant to ยง 1008.103 of this chapter or State SAFE Act implementing law:
---background check (would already have from registration of SAFE MLOs)
---credit report
---training
Commentary to 1026.36(f)(3)
1. Unlicensed individual loan originators. Section 1026.36(f)(3) sets forth actions that a loan originator organization must take for any of its individual loan originator employees who are not required to be licensed and are not licensed as a loan originator pursuant to the SAFE Act. Individual loan originators who are not subject to SAFE Act licensing generally include employees of depository institutions and their Federally regulated subsidiaries and employees of bona fide nonprofit organizations that a State has exempted from licensing under the criteria in 12 CFR 1008.103(e)(7).
1008.103 gives the requirements for who should be licensed and specifically excludes bank MLOs who are registered who have been exempted from licensing by their states. In TN at least, a bank MLO is exempt from licensing and the way I read 1026.36(f)(3), my MLOs would still need training (which we already do) and a credit report if not pulled at hire (I believe our bank already does this, but I know other banks in TN that don't).
Based on my read, if your LOs are only registered they are not grandfathered in on the credit report requirement. Also since there is no benchmark score in the reg, it is up to the bank to review the report and determine the LO's fitness to work as an LO.