Code of Maryland Regulations › Title 09 - MARYLAND DEPARTMENT OF LABOR › Subtitle 03 - COMMISSIONER OF FINANCIAL REGULATION › Chapter 09.03.06 - Mortgage Lending › Section 09.03.06.27 - Enhanced Prudential Standards for Certain Mortgage Servicers

Current through Register Vol. 51, No. 14, July 12, 2024
A. Definitions.
(1) In this regulation, the following terms
				have the meanings indicated.
(2)
				Terms Defined.
(a) "Agency" means Fannie Mae,
				Freddie Mac, and Ginnie Mae.
(b)
				"Allowable assets for liquidity means" those assets that may be used to satisfy
				the liquidity requirements herein, including unrestricted cash and cash
				equivalents and unencumbered investment grade assets held for sale or trade
				(for example, agency MBS, obligations of Fannie Mae or Freddie Mac, or U.S.
				Treasury obligations).
(c) "Board
				of directors" means the formal body established by a covered institution that
				is responsible for corporate governance and compliance with this
				regulation.
(d) "Covered
				institution" means a licensee who is a mortgage servicer with servicing
				portfolios of 2,000 or more one-unit to four-unit residential mortgage loans
				serviced or subserviced for others, excluding whole loans owned, and loans
				being interim serviced prior to sale as of the most recent calendar year end,
				reported in the NMLS Mortgage Call Report, and who operates in two or more
				states, districts, or territories of the United States, either currently or as
				of the prior calendar year end.
(e)
				"Fannie Mae" means Federal National Mortgage Association.
(f) "FHFA" means the Federal Housing Finance
				Agency.
(g) "Freddie Mac" means
				Federal Home Loan Mortgage Corporation.
(h) "Ginnie Mae" means Government National
				Mortgage Association.
(i) "Interim
				serviced prior to sale" means the activity of collecting a limited number of
				contractual mortgage payments immediately after origination on loans held for
				sale but prior to the loans being sold into the secondary market.
(j) "Mortgage Call Report" means the
				quarterly or annual report of residential real estate loan origination,
				servicing, and financial information completed by companies licensed in
				NMLS.
(k) "Mortgage-backed
				security" or "MBS" means a financial instrument, often a debt security,
				collateralized by residential mortgages.
(I) "Operating liquidity" means the funds
				necessary to perform normal business operations, such as payment of rent,
				salaries, interest expenses, and other typical expenses associated with
				operating the entity.
(m)
				"Residential mortgage loans serviced" means the specific portfolio or
				portfolios of residential mortgage loans for which a licensee is contractually
				responsible to the owner or owners of the mortgage loans for the defined
				servicing activities.
(n) "Reverse
				mortgage loan" has the meaning stated in Commercial Law Article, §
											12-1201, Annotated
				Code of Maryland.
(o) "Risk
				management assessment" means a functional evaluation performed under the risk
				management program and any report thereof provided to the board of directors
				under the relevant governance protocol.
(p) "Servicing liquidity" or "liquidity"
				means the financial resources available to the licensee to meet such financial
				obligations as may arise from the servicing of mortgage loans, including, but
				not limited to, acquiring and financing MSRs, hedging costs associated-with the
				MSR asset and financing facilities, including margin calls, and advancing or
				financing the advance of principal, interest, taxes, insurance, and any other
				servicing related advances.
(q)
				"Subserviced for others" means the contractual activities performed by
				subservicers on behalf of a servicer or MSR investor.
(r) "Tangible net worth" means total equity
				less receivables due from related entities, less goodwill, and other
				intangibles, less pledged assets.
(s) "Whole loans" means those loans for which
				a mortgage and the underlying credit risk is owned and held on the balance
				sheet of the entity with all ownership rights.