|Posted:||March 1, 2013 02:25 PM|
|From:||Representative Mario M. Scavello|
|To:||All House members|
|Subject:||Updating the Mortgage Licensing Act|
DATE: March 1, 2013
TO: All House Members
FROM: Rep. Mario M. Scavello
SUBJECT: Proposed Legislation- Updating the Mortgage Licensing Act
As we know, the Commonwealth’s passage of Act 31 of 2009 was in response to the requirements in the 2008 federal Secure and Fair Enforcement for Mortgage Licensing Act (S.A.F.E. Act).
In the near future, I will be introducing legislation to amending Title 7, Chapter 61, Mortgage Loan Industry Licensing and Consumer Protection, to make it consistent with the recently adopted federal Housing and Urban Development (HUD) regulations. Also, the bill will improve and clarify provisions of the original bill.
The bill will restore a person’s ability to originate, offer, negotiate, or service less than four mortgages loans in a calendar year, clarifies that a seller of a dwelling or real estate by the means of an installment sales contract is required to be licensed as a mortgage lender and have their employees licensed as mortgage loan originators.
The legislation will exempt non-profit organizations from mortgage loan originator licensing requirements, as the Department of Banking and Securities will have oversight as per federal regulations. In addition, the bill will eliminates the requirement that mortgage loan originators be W-2 employees, but requires direct supervision and control of such non- W-2 employees by the lender or broker.
It will clarify that the required minimum net worth for a mortgage lender is $250,000, removing the requirement that licensed lenders meet criteria established by the federally-regulated mortgage corporations. Also, it will ease the licensing requirements for branch offices in order to permit business to occur outside the mortgage lender and broker branch offices.
Introduced as HB1124