Spring/Summer 2017 States In Brief

Arkansas

The Governor of Arkansas signed into law HB 1801, which revises Arkansas’ Fair Mortgage Lending Act (FMLA). The revisions relate to the FMLA’s rules concerning licensing requirements for loan officers and mortgage brokers, surety bond requirements, and the duties of a licensee. This legislation was effective June 26, 2017.

California

The Governor of California signed into law Senate Bill 657, which revises the term lender to include certain independent contractors who engage in loan processing or underwriting activities for residential mortgage loans. The legislation was effective as of January 1, 2017.

Colorado

The Colorado Division of Real Estate revised and repealed several regulations related to the professional standards of mortgage loan originators and mortgage companies. The rules were effective March 17, 2017.

The Colorado Division of Real Estate also adopted regulations revising defined terms related to the practices of mortgage loan originators and mortgage companies. The rules were effective March 17, 2017.

Connecticut

The Connecticut legislature passed Senate Bill 906. The bill amends provisions primarily governing mortgage lead generators, but also mortgage loan originators, loan processors, and underwriters. Specifically, the revisions apply to certain definitions, license requirements, and rules regarding recordkeeping and advertising. These provisions are effective October 1, 2017.

Georgia

The Governor of Georgia signed into law House Bill 143, permitting financial institutions and mortgage lenders to charge a convenience fee. The bill was effective June 1, 2017.

The Governor of Georgia signed into law HB 221, which enacts the Uniform Power of Attorney Act. This legislation was effective July 1, 2017.

Indiana

The Governor of Indiana signed into law HB 1539, which amends Indiana’s Code concerning financial institutions. The revisions relate specifically to Indiana’s provisions regarding multiple business activities and prepayment penalties. This legislation was effective on July 1, 2017.

Iowa

The Iowa Division of Banking revised its regulations governing mortgage lending. Specifically, the regulations set forth requirements regarding licensees and applicants, bonds, recordkeeping requirements, changes of control, and allowable annual percentage rates. The revisions were effective July 1, 2017.

Kansas

The Governor of Kansas signed into law Senate Bill 20, implementing changes to a number of sections related to the Kansas Mortgage Business Act. The bill was July 1, 2017.

Louisiana

The Governor of Louisiana signed into law House Bill 400, which amends provisions of Louisiana law regarding the cancellation of mortgages. Specifically, the amendments provide for certain procedural changes and to provide a form for partial cancellation of a mortgage. This legislation is effective August 1, 2017.

Maryland

The Governor of Maryland signed into law SB 392, which amends Maryland’s regulations concerning closed-end credit. The revisions relate specifically to Maryland’s rules regarding the disclosure requirements of financing agreements and the disclosure requirements of loan commitments. This legislation was effective July 1, 2017.

The Governor of Maryland signed into law HB 182, which amends Maryland’s code concerning business regulation. The revisions relate specifically to Maryland’s provisions regarding consumer loan licensing. This legislation was effective July 1, 2017.

The Maryland Department of Labor, Licensing and Regulation, Office of the Commissioner of Financial Regulation amended its rules regarding recorded security instruments and foreclosure notices. The amendments were effective July 3, 2017.

Maine

The Maine legislature passed Senate Bill 280 which addresses a borrower’s right of redemption with regard to a judgment for foreclosure. The bill is effective 90 days after recess of the legislative session. The legislature is expected to adjourn sometime this summer.

The Maine legislature passed Maine Senate Bill 444 which makes revisions to the Consumer Credit Code. Specifically, the revisions address mortgage loan servicers and related terms. The bill is effective 90 days after recess of the legislative session. The legislature is expected to adjourn sometime this summer.

Nebraska

The Governor of Nebraska signed into law Legislative Bill 184, which gives the borrower the right to cancel a loan brokerage agreement within five (5) business days after the parties sign the agreement. The bill is effective
August 24, 2017.

Nevada

The Governor of Nevada signed into law Senate Bill 33, which relates to the foreclosure of property owned by military personnel or their dependents. The bill was effective May 29, 2017.

New Hampshire

The New Hampshire legislature passed House Bill 457, related to license requirements for mortgage servicers, small loans, and prohibited licensee behavior. The legislation is effective as of August 7, 2017.

New York

The Governor of New York signed into law Senate Bill 982, which added electronic signatures to the definition of the consummation of a mortgage loan. The bill was effective March 15, 2017.

North Dakota

The Governor of North Dakota signed into law Senate Bill 2304, increasing recording fees and updating recording requirements. The bill was effective July 1, 2017.

Oregon

The Oregon Department of Consumer and Business Services also amended its rules to allow mortgage professionals to submit required surety bond information through the Nationwide Mortgage Licensing System (“NMLS”). The amended rule was effective April 1, 2017.

The Oregon legislature passed Senate Bill 381, which amended its rules relating to the mailing of notices. Specifically, the amendments require that certain notices related to real estate loans to be mailed to all addresses on file for the recipient, including post office boxes. The amendments apply to the following notices mailed on or after January 1, 2018.

The Oregon legislature passed House Bill 2624 which exempts out-of-state banks, extranational institutions, and foreign associations from having to file notice before dealing in notes secured by mortgages or trust deeds if the entity is authorized to conduct banking business in Oregon by the Department of Consumer and Business Services. The bill is effective January 1, 2018.

South Carolina

The South Carolina Board of Financial Institutions amended its rules related to Mortgage Call Reports under the Mortgage Lending Act. The amendment seeks to further bring the South Carolina Mortgage Lending Act into conformity with the federal SAFE Act and rules issued by the Consumer Financial Protection Bureau. This amended rule was effective June 1, 2017.
The Governor of South Carolina signed into law Senate Bill 366, making several revisions to the state’s Consumer Protection Code and the Licensing of Mortgage Brokers Act. The bill makes amendments to the definitions of several terms, loan originator licensing requirements including the adoption of the Uniform State Test, lender disclosure requirements, and rules regarding branch office locations. The bill is effective September 16, 2017.

Texas

The Governor of Texas signed into law House Bill 2823, related to the issuance and enforcement of subpoenas during the course of investigating mortgage loan servicers. The bill provides that during the course of an investigation of a mortgage loan servicer, the commissioner may issue a subpoena requiring a mortgage loan servicer to a deposition, produce documents, or both. The bill was effective May 26, 2017.

Utah

The Governor of Utah signed into law House Bill 196, making several revisions to the Residential Mortgage Practices and Licensing Act. The bill was effective May 8, 2017.

Virginia

The Virginia State Corporation Commission, Bureau of Financial Institutions issued final regulations amending the Rules Governing Mortgage Lenders and Brokers. The amended regulations were effective May 15, 2017 and clarify certain licensing requirements and practices.
Washington
The Washington Department of Financial Institutions, Division of Consumer Services amended the rules under the Consumer Loan Act concerning requirements for residential mortgage loan servicers such as bonding, liquidity and tangible net worth. The amended rules are effective January 1, 2018.

Washington

The Washington Department of Financial Institutions, Division of Consumer Services amended the rules under the Consumer Loan Act concerning requirements for residential mortgage loan servicers such as bonding, liquidity and tangible net worth. The amended rules are effective January 1, 2018.

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