What is the maximum period during which a mortgage licensee cannot collect origination fees after a loan refinance?

The maximum period during which a mortgage licensee cannot collect origination fees after a loan refinance is 24 months. This regulation is in place to protect consumers from being charged excessive fees when they refinance their mortgage loans in a relatively short timeframe.

The rationale behind this rule is to ensure that the costs associated with refinancing do not become a burden for borrowers who might be looking to lower their interest rates or adjust their mortgage terms soon after obtaining their original loan. By prohibiting the collection of origination fees for 24 months post-refinance, the regulatory framework aims to promote fair lending practices and discourage predatory behavior. Lenders can still serve their clients in the refinancing process, but they must do so without imposing additional origination fees immediately following a recent refinance.

Understanding this timeframe is crucial for mortgage professionals to ensure compliance with state regulations and to provide appropriate guidance to clients considering refinancing options.