Source: http://www.wvlegislature.gov/bill_status/bills_text.cfm?billdoc=SB532%20SUB2.htm&yr=2009&sesstype=RS&i=532
Timestamp: 2018-03-24 05:16:55
Document Index: 523905658

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SB532 SUB2 Senate Bill 532 History
SB532 SUB2
A BILL to amend and reenact §31-17-1, §31-17-2, §31-17-3, §31-17-4, §31-17-5, §31-17-7, §31-17-11, §31-17-12, §31-17-13 and §31-17-20 of the Code of West Virginia, 1931, as amended; to amend said code by adding thereto a new article, designated §31-17A-1, §31-17A-2, §31-17A-3, §31-17A-4, §31-17A-5, §31-17A-6, §31-17A-7, §31-17A-8, §31-17A-9, §31-17A-10, §31-17A-11, §31-17A-12, §31-17A-13, §31-17A-14, §31-17A-15, §31-17A-16, §31-17A-17, §31-17A-18, §31-17A-19 and §31-17A-20; and to amend and reenact §46A-4-102 of said code, all relating to the Division of Banking's participation in the Nationwide Mortgage Licensing System and Registry; complying with the SAFE Mortgage Licensing Act; amending and creating definitions; exempting federally insured depository institutions from broker licensing; allowing the Division of Banking to participate in the Nationwide Mortgage Licensing System and Registry; permitting the Nationwide Mortgage Licensing System and Registry to process background and credit checks on behalf of the Commissioner of Banking; creating a tiered bond structure for licensed lenders and brokers; reducing the license processing time for lenders and brokers; requiring a new application for certain changes in control of mortgage licensees; clarifying the fee for licensee office relocation; synchronizing the mortgage annual report requirement with the Nationwide Mortgage Licensing System and Registry; outlining the purpose of the West Virginia SAFE Mortgage Licensing Act; defining terms associated with the SAFE Mortgage Licensing Act; requiring licensing and registration of mortgage loan originators; creating an application procedure for mortgage loan originators with minimum standards; requiring prelicensure education of mortgage loan originators; implementing a prelicensure testing requirement for mortgage loan originators; explaining standards for mortgage loan originator license renewal; clarifying annual continuing education requirements for mortgage loan originators; granting the commissioner authority to require mortgage loan originator licensing through the Nationwide Mortgage Licensing System and Registry; requiring the commissioner to create a challenge process for the Nationwide Mortgage Licensing System and Registry; creating enforcement authority for mortgage loan originators; defining violations and penalties of the SAFE Mortgage Licensing Act; requiring a surety bond to cover licensed mortgage loan originators that is tied to the amount of mortgage originations by each lender, broker or regulated consumer lender licensee; creating confidentiality provisions; granting investigation and examination authority to the Commissioner of Banking for violations of the SAFE Mortgage Licensing Act; outlining prohibited acts and practices for mortgage loan originators; requiring the Commissioner of Banking to report to the Nationwide Mortgage Licensing System and Registry; clarifying the use of unique identifiers; creating a severability section; defining effective dates; requiring the licensure of mortgage loan originators employed by licensed regulated consumer lenders; and implementing a bond requirement for regulated consumer lenders that originate mortgage loans.
(1) "Primary mortgage loan" means a consumer loan made to an individual which is secured, in whole or in part, by a primary mortgage or deed of trust upon any interest in real property used as an owner-occupied residential dwelling with accommodations for not more than four families; and "subordinate mortgage loan" mean any loan primarily for personal, family or household use that is secured by a mortgage, deed of trust or other equivalent consensual security interest on a dwelling as defined in Section 103(v) of the Truth in Lending Act or residential real estate upon which is constructed or intended to be constructed a dwelling.
(5) (4) "Broker" means any person acting in the regular course of business who, for a fee or commission or other consideration, negotiates or arranges, or who offers to negotiate or arrange, or originates processes or assigns a primary or subordinate mortgage loan between a lender and a borrower. A person is considered to be acting in the regular course of business if he or she negotiates or arranges, or offers to negotiate or arrange, or originates, processes or assigns any primary or subordinate mortgage loans in any one calendar year; or if he or she seeks to charge a borrower or receive from a borrower money or other valuable consideration in any primary or subordinate mortgage transaction before completing performance of all broker services that he or she has agreed to perform for the borrower.
(11) (10) "Licensee" means any person duly licensed by the commissioner under the provisions of this article or article seventeen-a of this chapter as a lender, broker or mortgage loan originator.
(13) (12) "Affiliated" means persons under the same ownership or management control. As to corporations, limited liability companies or partnerships, where common owners manage or control a majority of the stock, membership interests or general partnership interests of one or more such corporations, limited liability companies or partnerships, those persons are considered affiliated. In addition, persons under the ownership or management control of the members of an immediate family shall be considered affiliated. For purposes of this section, "immediate family" means mother, stepmother, father, stepfather, sister, stepsister, brother, stepbrother, spouse, child and grandchildren.
(14) (13) "Servicing" or "servicing a residential mortgage loan" means through any medium or mode of communication the collection or remittance for, or the right or obligation to collect or remit for another lender, note owner or noteholder, payments of principal, interest, including sales finance charges in a consumer credit sale, and escrow items as insurance and taxes for property subject to a residential mortgage loan. and
(15) (14) "Loan originator" means an individual who, on behalf of a licensed mortgage broker, under the direct supervision and control of a licensee who is engaged in brokering activity, and in exchange for compensation by that broker, performs any of the services described in subsection (5) of this section "Nationwide Mortgage Licensing System and Registry" means a mortgage licensing system developed and maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators for the licensing and registration of licensed mortgage brokers and lenders licensed under this article and mortgage loan originators licensed under article seventeen-a of this chapter.
(b) An entity applying for or holding both a lender and broker license shall license all of its individual loan originators if that entity brokers a majority of its residential mortgage loans. The determination of whether an entity brokers the majority of its residential mortgage loans is based upon the most recent annual report filed with the division pursuant to section eleven of this article. A new applicant applying for both a lender license and a broker license shall license all of its loan originators unless the applicant can demonstrate, through data compiled for other state regulators, that it acts as a lender for a majority of its residential mortgage loans made All mortgage loan originators, as that term is defined by section two, article seventeen-a of this chapter, shall obtain a mortgage loan originator license pursuant to said article.
(a) It shall be the duty of the commissioner to enforce the provisions of this article and, to implement and make effective such provisions, he or she is hereby authorized and empowered to promulgate reasonable rules and regulations, in accordance with the provisions of article three, chapter twenty-nine-a of this code and to employ such personnel as may be necessary.
(3) File with the commissioner a bond in favor of the state for the benefit of consumers or for a claim by the commissioner for an unpaid civil administrative penalty or an unpaid examination invoice in the amount of $50,000 for licensees with West Virginia loan originations of $0 to $3 million, $100,000 for West Virginia loan originations greater than $3 million and up to $10 million, and $150,000 for West Virginia loan originations over $10 million in a form and with conditions as the commissioner may prescribe and executed by a surety company authorized to do business in this state: Provided, That the bond must be in the amount of one hundred thousand dollars $150,000 before a broker may participate in a table-funded residential mortgage loan;
(a) Upon an applicant's full compliance with the provisions of section four of this article, the commissioner shall investigate the relevant facts with regard to the applicant and his or her application for a lender's or broker's or loan originator's license, as the case may be. Upon the basis of the application and all other information before him or her, the commissioner shall make and enter an order denying the application and refusing the license sought if the commissioner finds that:
(b) Each licensee shall file with the commissioner on or before the fifteenth day of March of each year a report under oath or affirmation concerning his or her business and operations in this state for the preceding license year upon participation in the Nationwide Mortgage Licensing System and Registry and on a date established by the Nationwide Mortgage Licensing System and Registry. in the form prescribed by the commissioner For license years 2008 and 2009, all licensees shall submit an annual report to the Division of Banking on or before March 15, 2009, and March 15, 2010, respectively, on a form prescribed by the commissioner.
(2) No A license shall may not be issued to a supervised financial organization other than to one primarily engaged in the business of making consumer loans through offices located within this state or to one licensed under the provisions of the West Virginia Mortgage Loan Act as contained in article seventeen, chapter thirty-one of this code, or to any banking institution as defined by the provisions of section two, article one, chapter thirty-one-a of this code. No A license will not be granted to any office located outside this state: Provided, That the limitation of licensing contained in this subsection shall does not prevent any supervised financial organization from making regulated consumer loans when the applicable state or federal statute, law, rule or regulation permits. No A license shall may not be issued to any person unless the commissioner, upon investigation, finds that the financial responsibility, experience, character and fitness of the applicant, and of the members thereof (if the applicant is a copartnership or association) and of the officers and directors thereof (if the applicant is a corporation), are such as to command the confidence of the community and to warrant belief that the business will be operated honestly, fairly and efficiently, within the purposes of this chapter, and the applicant has available for the operation of the business at least $10,000 in capital and has, for each specified location of operation, assets of at least $2,000.