How many years must mortgage loan compensation agreement records be retained?

How many years must mortgage loan compensation agreement records be retained?

• A. 1 year
• B. 3 years
• C. 5 years
• D. 7 years

Answer: (B)

The correct duration for retaining mortgage loan compensation agreement records is three years. This requirement is established to ensure that all documentation regarding compensation practices can be reviewed and audited if needed, providing oversight of compliance with applicable laws and regulations. Retaining these records for three years allows for a sufficient time frame to verify that a mortgage loan officer adhered to the established compensation structures, preventing issues related to discrimination or improper practices. While it may seem prudent to keep records for longer periods, regulations specifically mandate this three-year retention to balance the need for accountability with reasonable record-keeping practices. This time frame facilitates accurate oversight while ensuring that excessive burden on record-keeping is avoided.

The correct duration for retaining mortgage loan compensation agreement records is three years. This requirement is established to ensure that all documentation regarding compensation practices can be reviewed and audited if needed, providing oversight of compliance with applicable laws and regulations. Retaining these records for three years allows for a sufficient time frame to verify that a mortgage loan officer adhered to the established compensation structures, preventing issues related to discrimination or improper practices.

While it may seem prudent to keep records for longer periods, regulations specifically mandate this three-year retention to balance the need for accountability with reasonable record-keeping practices. This time frame facilitates accurate oversight while ensuring that excessive burden on record-keeping is avoided.