MBA State Relations Committee Update State Highlights

State Regulators Approve NMLS Fee Increases: Last week, the Board of Directors of the Conference of State Bank Supervisors (CSBS) approved a set of Nationwide Multistate Licensing System (NMLS) fee increases that were subject to notice and comment earlier this year. The increases, which were approved as proposed, become effective on March 1, 2025. MBA previously submitted comments to state regulators questioning the proposal, noting that the NMLS did not explain how the funds generated by the additional costs to the industry would be used. MBA also made clear that since the NMLS serves as a nationwide regulatory system with mandatory compliance, it should be obliged to engage in a budgetary process similar to what CSBS’s state regulator members go through by providing transparency about the NMLS budget and the planned programmatic uses of any proposed fee increases. The fee increases will be implemented for all mortgage, consumer finance, debt, and money services businesses applicants and licensees in the NMLS. Specifically, the proposal would increase from $100 to $120 in initial set-up/application and annual processing fees for banks and IMBs, among other increases. MBA will continue to engage with state regulators as they evaluate NMLS fees. The next NMLS fee review phase will occur next year and will related to business-to-business and ad-hoc reports. NMLS is planning a third fee review in 2026 on testing and education.

Newly Adopted Illinois Rules Require IMB CRA Exam Fees on January 1, 2025: On Friday, December 20, the Illinois Department of Financial and Professional Regulation’s (IDFPR) rules to revise the fee structure for Illinois Community Reinvestment (ILCRA) exams of independent mortgage banks (IMBs) were adopted by the Joint Committee on Administrative Rules (see the Illinois Register, page 147). The new ILCRA exam fees for IMBs will be due by January 1, 2025. In August, IDFFPR proposed replacing the ILCRA examination fee with this annual fee on each Illinois licensed IMB based on their total loan volume regardless of whether an actual exam is performed. This annual assessment would cost roughly $22,000 a year for the largest IMBs. MBA’s previous comments strongly opposed the proposal and requested further cost analysis to understand the need for fee structure change as well as clarification to consider origination count. In its comments, among other objections, MBA pointed out that it was highly inappropriate to base this fee on total national loan volume, and that IDFPR must narrow that scope to only loans on Illinois properties. The IDFPR agreed, and issued this important change, which will save MBA members thousands in annual fees. However, IDFPR’s previously proposed payment date for 2025 fees of November 1st was only delayed to January 1st, providing little notice to licensees. The first examinations for IMBs originating over 100 loans annually is set to begin February 1st, 2025. MBA will communicate any information regarding the examination schedule and how to assist IMBs’ preparation for these exams.

MBA Relaunches State Legislative Tracking Tool for Members: Last week, MBA’s State Government Affairs program announced the return of its comprehensive database of state legislation, available to staff at member companies and current state association partners. Once a member logs into MBA’s website, they can track any current piece of real estate finance-related legislation in any state. Members of MBA’s State Legislative and Regulatory Committee (SLRC) have seen the return of the biweekly email updates on the status of major bills; free monthly database trainings sessions will recommence in January. The policy challenges facing member companies – particularly state-licensed firms – are voluminous, and the database will be tracking thousands of introduced bills. The system offers members a single and effective way to stay abreast and informed of any developments by “flagging” or “grouping bills” for automatic email updates. MBA will be utilizing the database to brief SLRC members and will also encourage its state partners to take advantage of its many functions for enhancing their member value and their voices in their respective state capitals.