Summer 2014 States In Brief

Arizona HB 2018

The Governor of Arizona signed into law HB 2018 relating to Arizona’s anti-deficiency statutes.  This legislation is effective July 24, 2014.

Arizona HB 2098

The Governor of Arizona signed into law HB 2098 relating to loan originators.  Specifically, this legislation amends the requirements for obtaining a loan originator license.  This legislation is effective July 24, 2014.   

Colorado HB 1295

The Governor of Colorado signed into law HB 1295, regarding foreclosures. The legislation requires a lender to establish a single point of contact for a borrower to communicate with the lender concerning foreclosure matters after the borrower becomes delinquent in payments, and prohibits dual tracking in which a lender simultaneously negotiates with the borrower for a loan modification and pursues foreclosure through the public trustee. This legislation is effective January 1, 2015, and applies to foreclosure proceedings in which the notice of election and demand is filed on or after said date.

Colorado HB 1130

The Governor of Colorado signed into law HB 1130, regarding the procedure for cure statements in foreclosure actions, the duty of lenders to retain relevant records, the duty to update cure statements to the public trustee, and the handling of funds by the public trustee. This legislation applies to foreclosure proceedings initiated after May 9, 2014.

Connecticut SB 283

The Connecticut legislature enacted Senate Bill 283, which revises the definition of “nonprime home loan.”  Specifically, the legislation excludes FHA-insured loans which are “qualified mortgages” from the definition.  This provision is effective October 1, 2014.

Connecticut SB 221

The Governor of Connecticut signed into law SB 221, regarding credit checks and financial institutions.  This legislation is effective October 1, 2014.

Connecticut HB 5353 and HB 5514

The Governor of Connecticut signed into law HB 5353 and HB 5514, regarding mortgage servicers; mortgage lender, mortgage correspondent lender, or mortgage broker licensure exceptions; the foreclosure mediation program; and foreclosures generally.   The majority of the provisions are effective October 1, 2014.

Delaware Amendments

The Delaware Office of the State Bank Commissioner amended regulations governing Mortgage Loan Brokers and Licensed Lenders. The amended regulations were effective April 11, 2014.

Georgia DBF Rules

The Georgia Department of Banking and Finance adopted final revisions to its regulations under the Georgia Residential Mortgage Act.  These changes were effective June 30, 2014.

Hawaii SB 2818 and HB 2513

The Governor of Hawaii signed into law SB 2818 and HB 2513 relating to mortgage servicers and mortgage foreclosures.  These bills are currently effective.

Hawaii HB 2585

The Governor of Hawaii signed into law HB 2585 relating to foreclosures.  HB 2585 is currently in effect.

Hawaii SB 2817

The Governor of Hawaii signed into law SB 2817 relating to Hawaii’s Secure and Fair Enforcement for Mortgage Licensing Act.  SB 2817 will be effective July 1, 2014.

Illinois SB 3423

The Illinois legislature passed SB 3423, which amends provisions of the Illinois Collateral Protection Act.  The Collateral Protection Act (the “Act”) sets forth requirements regarding the placement of collateral protection insurance, including notice and cancellation requirements.  The legislation provides that a servicer subject to the regulations prescribed by the CFPB regarding force-placed insurance (12 CFR § 1024.37) that places hazard insurance in substantial compliance with those regulations is deemed to be in substantial compliance with the terms of the Act.  The legislation is effective upon signature of the Governor. 

Illinois HB 5685

The Illinois legislature passed HB 5685, which amends requirement relative to the Predatory Lending Database.  The legislation also revises notification and financial statement requirements applicable to mortgage licensees.  Once signed by the Governor, the legislation is effective January 1, 2015.

Indiana 2014 Dollar Fee Changes

The Indiana Department of Financial Institutions released dollar amount changes under the Uniform Consumer Credit Code.  For subordinate lien loans the permissible late charge is increased from $18.00 to $18.50.  This change is effective July 1, 2014 through  June 30, 2016.

Kansas HB 2643

The Governor of Kansas signed into law HB 2643 which relates to phasing out mortgage tax and replacing it with fees for recording certain documents and instruments. This act is effective July 1, 2014.

Louisiana HB 807

The Governor of Louisiana signed into law HB 807, adding licensure requirement for persons engaged in residential mortgage servicing. This legislation was effective June 30, 2014.

Maine HB 992

The Governor of Maine signed into law HB 992, which relates to an expedited foreclosure process for abandoned property.  The bill is effective August 1, 2014.

Maryland HB 1045

The Governor of Maryland signed into law HB 1045 which relates to the lien priority of refinance mortgages and escrow costs.  Specifically, this legislation alters the circumstances under which a mortgagor or grantor who refinances the indebtedness secured by a first mortgage or deed of trust on residential property is not required to obtain permission from the holder of a junior lien.  This legislation is effective October 1, 2014.

Massachusetts Regulations Regarding Recordkeeping

The Massachusetts Office of Consumer Affairs and Business Regulation, Division of Banks amended regulations establishing procedures and requirements for record keeping by mortgage lender and mortgage broker licensees. The amendments better address electronic records, and require licensees to update and maintain books and records information in the Nationwide Mortgage Licensing System and Registry. The amendments also apply to third party loan servicers. These amendments were effective    June 6, 2014.

Massachusetts Regulations Regarding Net Tangible Benefits

The Massachusetts Office of Consumer Affairs and Business Regulation, Division of Banks amended its net tangible benefit regulations to provide for an exemption for safe harbor qualified mortgages.  This amendment was effective 7-18-14.

Michigan HB 5277

The Governor of Michigan signed into law HB 5277, relating to foreclosures.  Specifically, this legislation amends Chapter 32 of the Revised Judicature Act, which provides for foreclosure of mortgages by advertisement.  The legislation was effective June 19, 2014.

Minnesota HB 2213

The Governor of Minnesota signed into law HB 2213, which amends the definition of a small servicer, relates to mortgage foreclosures, and clarifies the Foreclosure Curative Act.  The legislation is currently effective.

Mississippi HB 696

This legislation states that each document or instrument, other than a plat or survey or a drawing related to a plat or survey that is presented for recording shall include the name, mailing address and telephone number of every grantor, grantee, borrower, beneficiary, trustee or other party to the instrument. This legislation was effective July 1, 2014.

Missouri Company NMLS License Transition

The Missouri Division of Finance will be transitioning its company licensing onto the Nationwide Mortgage Licensing System, effective June 2, 2014. All currently licensed Missouri companies must transition their license onto the NMLS by October 1, 2014.

New Jersey Mortgage Rules and Regulations

The New Jersey Department of Banking and Insurance, Division of Banking has readopted rules and regulations regarding mortgages. These rules are currently in effect.  The rules at N.J.A.C. 3:10, concerning mortgages, were scheduled to expire on May 20, 2014. The Department readopted the rules without any amendments except to the expiration date, which has been extended to April 9, 2021.

New York SB 7224

The New York legislature has passed Senate Bill 7224, which revises the subprime loan thresholds applicable to most FHA loans.  Once signed by the Governor, the legislation will go into effect immediately.

New York Emergency Subprime Calculation

The New York Department of Financial Services has announced a new extension of its emergency rule – Title 3 NYCRR Part 42 – which adjusts by 75 basis points the calculation used to trigger the definition of a subprime home loan in New York for most FHA-insured loans.  This increased threshold will continue to be in effect until September 19, 2014.

Oklahoma SB 1940

The Governor of Oklahoma signed into law SB 1940, authorizing the reduction of licensing fees. This bill becomes effective August 22, 2014.

Rhode Island SB 2789 and HB 7997

The Governor of Rhode Island signed into law SB 2789 and HB 7997, which implement a new licensing requirement for third-party loan servicers.  This legislation is effective July 1, 2015.

Rhode Island SB 2659 and HB 7449  

The Governor of Rhode Island signed into law SB 2659 and HB 7449, which implement notice requirements applicable to foreclosures of tenant-occupied properties and limits evictions of tenants by foreclosing owners. This legislation is currently effective.

Rhode Island HB 8293

The Governor of Rhode Island signed into law HB 8293, which amends current provisions regarding foreclosure mediation.  This legislation is effective October 6, 2014 and will expire on July 1, 2018.

South Carolina SB 1007

The Governor of South Carolina signed into law SB 1007, relating to expedited foreclosures.  This legislation provides a process for expediting mortgage foreclosures of abandoned property and provides the necessary terminology. The legislation was effective June 2, 2014.

Tennessee HB 2208

The Governor of Tennessee signed into law HB 2208, regarding foreclosures. Specifically, this legislation authorizes a trustee to rescind a foreclosure sale within five business days of a sale of land for the foreclosure of a deed of trust. This legislation is currently effective.

Tennessee SB 1628

The Governor of Tennessee signed into law SB 1628, regarding the regulation of non-depository financial institutions, meaning premium finance companies, industrial loan and thrift entities, residential lending entities, title pledge entities, deferred presentment entities, and check cashing entities, that are governed by the Department of Financial Institutions. This legislation is effective July 1, 2015.

Texas Supreme Court Opinion – Modification of Home Equity Loans

The Texas Supreme Court issued an opinion addressing certified questions from the U.S. Court of Appeals for the Fifth Circuit regarding the applicability of Texas home equity lending restrictions when a home equity loan is modified or restructured.

Wyoming HB 91

The Governor of Wyoming signed into law HB 91 relating to banks and restricted transactions.  This act was effective July 1, 2014.

Posted in Newsletters, States In Brief


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