How long must an MLO keep records of transactions as per federal regulations?

The requirement for Mortgage Loan Originators to retain records of transactions for at least three years is established by federal regulations, specifically under the Real Estate Settlement Procedures Act (RESPA) and other applicable laws. This duration ensures a sufficient period for regulatory review and consumer access to information if disputes arise or if they need to verify the details of their transactions.

Keeping records for three years provides adequate time for oversight by regulatory authorities and offers protections for consumers seeking remedies or information related to their loans. It balances the need for thorough documentation and the operational demands of mortgage lending.

The specified timeframe is not just arbitrary; it reflects an understanding of the financial nature of mortgage transactions and the importance of maintaining thorough records for auditing, compliance, and consumer safety.