Who is responsible for the retention and disposition of records in an active lending entity?

The principal lending manager (PLM) is responsible for the retention and disposition of records in an active lending entity because this role encompasses oversight of compliance with both state and federal regulations regarding documentation and record-keeping. As part of ensuring operational integrity and adherence to ethical standards, the PLM is tasked with maintaining accurate records that are vital for audits, legal compliance, and internal reviews. This responsibility includes establishing policies for record retention timelines and ensuring secure disposal of records when they are no longer needed, aligning with industry best practices and regulatory requirements.

While other roles within a lending entity, such as loan originators and compliance officers, have important responsibilities, they do not encompass the comprehensive oversight that the PLM has regarding records management and compliance. The loan originator's role focuses primarily on the initiation and processing of loans, while the compliance officer ensures the organization adheres to laws and regulations but may not have direct responsibility for records retention. The borrower, on the other hand, is not involved in the internal management of the lending entity's records. Thus, the PLM is the designated authority for these critical functions.