How to Write an Efficient L.O.E. to Regulators

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Striving and thriving are what humans do best! We are all human. Although many of us may wish every day to be able to conquer the world as though we were robots, the reality is – we are not.Advance Change Notice

Harmoniously, being human comes with human error. However, error does not equate devastation. In fact, often we find ourselves swimming in an extraordinary amount of forgiveness. Whether the excused situation be derived from others or the self, forgiveness is in the hearts of humans. No computer ever forgave you for not saving before exiting. This is what makes mistakes so beautiful! This is what motivates us to keep doing what we do best!

“How much you can learn when you fail determines how far you will go into achieving your goals.” – Roy Bennett

The same mistakes made, as a youth, constructed our paths into who we have become today! You are a part of the mortgage industry because of the successful lessons learned from your life experiences.

Though, forgiveness only offers 50% of a favorable outcome, the efforts to ask for forgiveness are a step closer to the finalized best self you can possibly be. Similarly, to the successes of conversion rates, don’t allow the fear of rejection to discourage your efforts to pursue your goals! You have a 50% chance to achieve!

Disclosures, Deficiencies, and Denials! Oh, my!

These are the words we hope we never see when applying for a new mortgage broker license. Sometimes, they’re unavoidable, much like the times we didn’t avoid our mistakes even though we may have foreseen an unfavorable outcome. After submitting your license application through the NMLS, some are likely to experience a Private License Item, with various requests sent by regulators to your inbox. Fortunately, like the rest of us, regulators are humans as well!  As long as the outcome falls within regulated forgiveness guidelines, the regulator may choose to approve the license with a Letter of Explanation [L.O.E].

3 Tips for Writing an Efficient L.O.E.

We perform in a professional industry. Before giving away any secrets, lets first remember to remain professional. Using a business letter format is the perfect aesthetic for sending a form requesting forgiveness. It’s much easier on the eyes.

Briefly Explain ‘What Happened?’

This is your chance to explain the situation from your perspective. Perhaps, a fight broke out in a bar when you were 22 years old, and you defended yourself by restraining your attacker, but were still arrested for your involvement when police arrived. This is your moment to explain this brief situation. A minimalized description will suffice, as the regulator is very restricted on time and would like to keep every document as simple and direct as possible.

Your L.O.E is precious, since it could have a major impact on the approval of your license, and perhaps a public disclosure. Adding a few details to the description to explain various hardships could help your case in terms of judgment of character as well. We get so busy in life juggling work and home. At times, home can throw us too many balls, and soon enough we find ourselves striving to thrive as more obstacles get in the way of our successes. Getting laid off is a very unfortunate and common obstacle some individuals face. It’s not uncommon to experience debt and other unfortunate losses as a result of a new unemployment matter, as businesses grow, shrink, and fail every day. Briefly explaining the circumstances leading up to a Private License Item as a result to your credit report, could serve in your favor.

…talent means nothing, while experience, acquired in humility and with hard work, means everything.” – Patrick Süskind

What did you Learn?

Redundancy can only be stopped by learning the lesson resulting from our mistakes. Perhaps an improvement in your social circle, personal budget classes, or opening your own business helped you overcome your obstacle. Regulators want to be sure you are reliable. By communicating your lesson to your state regulator, you are demonstrating the quality of your business practice as well.

How can you ensure it never happens again?

Of course, like most humans, regulators don’t expect you to predict the future. However, continuing to forget your tax deadline, may not grant you access to your mortgage company’s expansion. Be clear, honest, and humble. Regulators are happy to hear the issue has been resolved, even if 35 years of sobriety got your there! The states want you to be able to help your borrowers. The reflection of your accountability and responsibility demonstrates a reliable mortgage broker, or mortgage lender, to interested borrowers!

The Mortgage Licensing Group, Inc. is a full-service mortgage licensing firm headquartered in Southern California that is recognized throughout the industry as an experienced and reliable service provider. Established in 2006, our company has been on the forefront of the ever-changing rules and regulations, helping alleviate the often daunting task of meeting the diverse state licensing requirements for our clientele.

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