Summer-Fall 2020 States In Brief

California

California’s Governor signed Assembly Bill 1864, which, among other things, amends the name of the Department of Business Oversight. Effective immediately, the Department of Business Oversight is the “Department of Financial Protection and Innovation.”

California passed Senate Bill 1148, relating to notice of sale requirements. The Bill amends the initial requirement that a notice of sale be published in the city in which the property is situated. It is effective January 1, 2021.

Delaware

Delaware passed Senate Bill 245, related to the definition of “purchase money mortgages.” The Bill amends the definition of “purchase money mortgage” and extends the time to record the purchase money mortgage in order to claim priority. The Bill was effective September 28, 2020.

District of Columbia

On May 4, 2020, the Mayor of DC signed DC Act 23-299/23-0735, to amend, on emergency basis, the COVID-19 Response Supplemental Emergency Amendment Act of 2020 to include mortgage lenders as covered entities.

Florida

Florida passed Senate Bill 886, related to scrivener’s errors in deeds. The new Section provides curative procedures for scrivener’s errors in deeds and a model curative notice form. The Bill was effective
July 1, 2020.

Georgia

The Governor of Georgia signed into law Senate Bill 315, amending Georgia’s statutory lien waiver law. The Bill is effective January 1, 2021.

Georgia passed House Bill 781, which makes several amendments relating to financial institutions, including updates to the Georgia Residential Mortgage Act. The Bill is effective on January 1, 2021.

Idaho

Idaho passed House Bill 401, related to the definitions of mortgage lender and qualified person in charge. It also grants temporary authority to operate to unlicensed loan originators. Additionally, the Bill requires mortgage servicers to be licensed. The Bill was effective on July 1, 2020.

Indiana

The Indiana Department of Financial Institutions passed Senate Bill 395, which updates the date for when certain dollar amounts will change under the Uniform Consumer Credit Code and creates a prohibition on precomputed transactions. Additionally, the Bill creates a new provision which prohibits precomputed transactions on consumer loans entered into on or after July 1, 2020. Senate Bill 395 was effective
July 1, 2020.

Iowa

Iowa recently adopted Regulation Text 4941, which rescinds the rule related to denying a mortgage loan originator license application when the applicant is in default or delinquent on student loan debt. The regulation was effective August 19, 2020.

Mississippi

Mississippi passed Senate Bill 2427, related to the Mississippi S.A.F.E. Mortgage Act. The Bill reenacts the Mississippi S.A.F.E. Mortgage Act, extends and clarifies the time during which licensees must maintain their books, accounts, and records, and clarifies the type of estimate of costs provided to the borrower. The Bill was effective July 1, 2020.

Missouri

Missouri passed Senate Bill 599, which amends the Missouri SAFE Act. The Bill amends provisions related to prelicensing education, control persons, advertisements, and the requirement for a full-service office. Senate Bill 599 was effective August 28, 2020.

Montana

Montana adopted Regulation Text 7691, which relates to quarterly report submissions by a mortgage servicer licensee. A mortgage servicer licensee is required to compile and submit a report to the Department 45 days after the end of each quarter. The quarters end on March 31, June 30, September 30, and December 31. Effective August 29, 2020 until June 1, 2021, a mortgage servicer has an additional 30 days to submit the reports, for a total of 75 days.

Montana adopted Regulation Text 7717, related to renewal fees of licensees under the Montana Mortgage Act. Specifically, the department is reducing renewal fees for all mortgage industry license types by two-thirds for the 2021 renewal period due to the COVID-19 pandemic. The amendments were effective October 10, 2020 and remain in effect until December 31, 2021.

New York

New York passed Senate Bill 8243-C and Senate Bill 8428, relating to the forbearance of residential mortgage payments. Under Senate Bill 8243-C, the banking law is amended to add Section 9-x. The New York Department of Financial Services subsequently provided Frequently Asked Questions to help clarify Section 9-x.

Oklahoma

The Oklahoma Department of Consumer Credit released changes in dollar amounts under the Uniform Consumer Credit Code. Certain amounts are subject to change every year. The maximum late charge for consumer loans is not less than $5.00 and not more than the greater of 5% or $26.50 (for 2020) of an installment delinquent for more than 10 days. This change was effective July 1, 2020.

Oregon

Oregon passed House Bill 4204, which requires a lender to provide notice to borrowers of certain rights in relation to COVID-19 during the emergency period. The Bill applies retroactively to the emergency period (March 8, 2020 through September 30, 2020).

South Carolina

The South Carolina Department of Consumer Affairs has released the dollar amounts under the Consumer Protection Code for the period of July 1, 2020 through June 30, 2022.

Texas

Texas adopted Regulation Text 38129, which amended the Texas Administrative Code to reduce certain fees and update provisions relating to a loan originator’s criminal history under the Consumer Credit Code. The amendments went into effect on May 7, 2020.
Texas recently adopted Regulation Text 38720, related to payoff statements issued by mortgage servicers. Specifically, the amendments add color to what is considered “sufficient information” in identifying the loan for payoff in a payoff statement. The amendments were effective September 20, 2020.

Utah

Utah passed House Bill 147, which amends certain definitions, provisions related to prohibited conduct for licensees, and provisions related to criminal background checks. These amendments went into effect on May 12, 2020.

West Virginia

The Governor of West Virginia signed Senate Bill 651, relating to the definition of mortgage loan originator with respect to retailers of manufactured or modular homes and their employees. The Bill was effective June 2, 2020.

The Governor of West Virginia signed House Bill 4411, related to the final mortgage installment payment on a primary or subordinate mortgage loan. The Bill was effective May 27, 2020.

West Virginia passed House Bill 4576, related to correcting obvious errors in deeds, deeds of trusts, and mortgages. The Bill creates procedures and model forms to correct obvious errors. The Bill was effective June 5, 2020.
The Governor of West Virginia also signed House Bill 4411, related to the final mortgage installment payment on a primary or subordinate mortgage loan. The Bill was effective May 27, 2020.

West Virginia passed House Bill 4576, related to correcting obvious errors in deeds, deeds of trusts, and mortgages. The Bill creates procedures and model forms to correct obvious errors. The Bill was effective June 5, 2020.

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