Code of Massachusetts Regulations › 209 CMR - DIVISION OF BANKS AND LOAN AGENCIES › Title 209 CMR 42.00 - The Licensing Of Mortgage Lenders And Mortgage Brokers › Section 42.02 - Definitions

Current through Register 1525, July 5, 2024
As used in
				209 CMR 42.00 the following
				words shall, unless the context otherwise requires, have the following
				meanings:
Applicant
means any mortgage lender or
				mortgage broker who is required to be licensed under the provisions of M.G.L.
				c. 255E, § 2.
Applicant
shall include partners or
				members, if the applicant is a partnership or association, and officers,
				directors and principal employees, if the applicant is a corporation.
Bona Fide
Nonprofit Affordable
				Homeownership Organization
means a Massachusetts nonprofit
				corporation with a primary purpose of helping qualified low-income individuals
				build, repair and purchase affordable housing and meets the definition of
Bona Fide
Nonprofit Organization set forth in 12 CFR Part
				1008.103(e)(7)(ii) .
Commissioner
means the Commissioner of
				Banks.
Government Sponsored Enterprise
means
				a financial services corporation created by the United States Congress
				including, but not limited to, the Federal National Mortgage Association,
				Federal Home Loan Mortgage Corporation, and Government National Mortgage
				Association.
Instrumentality Created by the United States or Any
				State
means a federal, state, municipal government,
				quasi-governmental entity or a nonprofit agency or corporation incorporated
				under the laws of the Commonwealth that has a tax exempt status granted under
				the provisions of § 501(c)(3) of the federal Internal Revenue Code, which
				exclusively makes or issues commitments for mortgage loans on residential
				property to be financed with public funds, or negotiates, places, assists in
				the placement of, finds, or offers to negotiate, place, assist in the placement
				of or find mortgage loans on residential property to be financed with public
				funds only under a contract with a federal, state, or municipal government, any
				instrumentality thereof or any quasi-governmental entity as determined by the
				commissioner. The making of a mortgage loan shall include being named as the
				lender or mortgagee on the note, mortgage or other loan documents.
Licensee
means any person who is
				licensed by the Commissioner as a mortgage lender or mortgage broker under
				M.G.L. c. 255E and
				209 CMR 42.00.
Mortgage Broker
means any person who
				for compensation or gain, or in the expectation of compensation or gain,
				directly or indirectly negotiates, places, assists in placement, finds or
				offers to negotiate, place, assist in placement or find mortgage loans on
				residential property for others. A person who collects and transmits
				information regarding a prospective mortgage loan borrower to a third party and
				conducts any one or more of the following activities is a mortgage
				broker:
(a) collects a prospective mortgage loan borrower's Social
				Security number;
(b) views a prospective mortgage loan borrower's credit
				report;
(c) obtains a prospective mortgage loan borrower's
				authorization to access or view the prospective mortgage loan borrower's credit
				report or credit score;
(d) accepts an application, as defined under
				12 CFR §
									1026.2(a); or
(e) issues a prequalification letter.
Mortgage Lender
means any person
				engaged in the business of making mortgage loans, or issuing commitments for
				mortgage loans.
Mortgage Loan
means a loan to a
				natural person made primarily for personal, family or household purposes
				secured wholly or partially by a mortgage on residential property.
Mortgage Loan Originator
means a
				natural person who is not exempt from licensure pursuant to M.G.L. c. 255F,
				§ 2(b) and
				209 CMR
				41.03:
Licensing Exemptions
,
				who is employed by no more than one entity and for compensation or gain or in
				the expectation of compensation or gain:
(a) takes a residential mortgage loan application; or
(b) offers or negotiates terms of a residential mortgage loan.
Mortgage Loan Rate Lock Commitment
means a written or electronically transmitted confirmation issued to a consumer
				by a mortgage lender for a mortgage loan which, subject to the terms set forth,
				obligates the mortgage lender to make a mortgage loan at a specified interest
				rate.
NMLS
means the Nationwide Multi-state
				Licensing System & Registry, a multistate licensing system owned and
				operated by the State Regulatory Registry LLC (SRR), a wholly owned subsidiary
				of the Conference of State Bank Supervisors (CSBS), an association of state
				financial services regulators.
Net Worth
means the applicant's or
				licensee's total assets less total liabilities, omitting the following
				assets:
(a) that portion of an applicant's assets pledged to secure
				obligations of any person or entity other than that of the applicant;
(b) any asset due from officers or stockholders of the
				applicant or persons in which the applicant's officers or stockholders have an
				interest;
(c) an amount in excess of the lower of the cost or fair market
				value of mortgage loans in foreclosure, or real property acquired through
				foreclosure;
(d) an investment shown on the balance sheet in joint ventures,
				subsidiaries, or affiliates, which is greater than the fair market value of the
				assets;
(e) goodwill or value placed on insurance renewals or other
				similar intangible value;
(f) organization costs;
(g) the value of servicing contracts not determined in
				accordance with the Financial Accounting Standards Codification Topic 860
Transfers and Servicing
;
(h) for an applicant that is applying to hold the mortgage
				broker or mortgage lender license as a natural person, any real property having
				thereon a dwelling house with accommodations for four or less separate
				households and occupied, or to be occupied, in whole or in part by the
				applicant; and
(i) any other intangible asset, as may be determined by the
				Commissioner.
Non-bank Affiliate
means an affiliate
				that is not a savings bank, a co-operative bank, a trust company, a federal
				bank, an out-of-state bank, or an out-of-state federal bank, as defined in
				M.G.L. c. 167, § 1.
Non-bank Subsidiary
means a subsidiary
				that is not a savings bank, a co-operative bank, a trust company, a federal
				bank, an out-of-state bank, or an out-of-state federal bank, as defined in
				M.G.L. c. 167, § 1.
Person
means a natural person or an
				organization including a corporation, partnership, association, cooperative or
				trust.
Rate Lock Commitment Fee
means points
				or other fees, or discounts taken by a mortgage broker for transmittal to a
				mortgage lender or taken directly by a mortgage lender as consideration for the
				making of a mortgage loan rate lock commitment.
Residential Property
means real
				property located in the commonwealth having thereon a dwelling house with
				accommodations for four or less separate households and occupied, or to be
				occupied, in whole or in part by the obligor on the mortgage debt.