Introduction to Mortgage Origination Examinations Training eBook

Internal Use Only

MMC Exam Comments

Internal Use Only

MLO Compensation policies and procedures are deficient at managing the compliance risk in the products, services, and activities of the financial institution. The Company sponsors a large number of MLO competitions providing awards that are organized at manager discretion. These competitions were, previous to the MMC examination, not documented or monitored for compliance by senior management. The Company’s MLO compensation plans were numerous and complex. Competitions and awards were not tracked properly, compensation plans were complex, and compensation included incentive pay for loan product type. The Company has made progress by way of documenting and tracking discretionary competitions and award payments and reducing the number and complexity of the compensation plans. However, there is still concern with the reintroduction of unit adjusters/modifiers for loan product type within certain campaigns, along with the frequency of compensation revisions.