Which entity is responsible for regulating mortgage loan originators?

The correct choice is that state regulatory bodies are responsible for regulating mortgage loan originators. Each state has established its own regulatory framework to oversee the licensing and conduct of mortgage loan originators, ensuring compliance with state laws and protections for consumers. These state agencies handle the application process for originating licenses, conduct background checks, and enforce state-specific regulations related to mortgage lending practices.

While the federal government, through agencies like the Consumer Financial Protection Bureau (CFPB), provides oversight and sets certain national standards for mortgage lending practices, it does not directly regulate individual mortgage loan originators. The CFPB focuses more on consumer protection and enforcing federal consumer financial laws rather than licensing or regulating originators at the state level.

The Federal Housing Administration (FHA) primarily deals with insuring loans and overseeing specific housing programs, rather than regulating loan originators. Local housing authorities typically address municipal housing programs and are not involved in the licensing or regulation of mortgage loan originators. Thus, state regulatory bodies play the central role in this aspect of mortgage lending, ensuring that loan originators act in compliance with both state and federal laws to protect consumers.