Louisiana Office of Financial Institutions

Presentation Transcript

Louisiana Office of Financial Institutions Orientation to the Louisiana Secure and Fair Enforcement of Mortgage Licensing Act of 2009 Or Louisiana S.A.F.E. Private Mortgage Lending Act Updated08-10

SAFE Residential Mortgage Lending Act LSA-R.S. 6:1081 through 6:1099 Enacted successful July 31, 2009 Provides for licensure of home loan originators, representatives, and moneylenders Amended powerful August 15, 2010

Residential Mortgage Lending Act Subdivided into three sections PART I. GENERAL PROVISIONS Definitions Prohibitions Promulgation of Rules PART II. LICENSURE, REGISTRATION, & CERTIFICATION Licensure Requirements Applications Recordkeeping – OFI Rule RML 01-01 Examination and Investigation of Complaints Suspension and Revocation of Licenses and Registrations PART III. Private MORTGAGE LOANS Fees and Charges Mortgage Loan Origination Agreements Criminal Penalties Part IV. Invert Mortgage Loans Requirements Counseling Commitment and chilling period Duties to seniors

Residential Mortgage Lending Act Who must be authorized Originators (counting contract processors and guarantors) Brokers Lenders Wholesale Lenders which are not generally excluded

Definitions "Contract Loan Originator" implies a person who for remuneration or pick up or with the desire of pay or pick up takes a private home loan credit application or offers or arranges terms of a private home loan advance.

Definitions Mortgage Broker or Residential Mortgage Broker any individual who, straightforwardly or in a roundabout way, for remuneration or desire of pay, arranges, places, or finds, or offers to arrange, place or locate a private home loan advance for someone else incorporates FHA advance journalists and moneylenders who table reserve advances

Definitions Mortgage Lender or Residential Mortgage Lender any individual who, specifically or in a roundabout way, starts or makes, or offers to begin or make, a private home loan advance for someone else

Definitions Residential Mortgage Lending Activity any action, including electronic action, occupied with for pay or with the desire of pay regarding a private advance exchange including beginning or financing, transaction or position, or offering to negotiate,place or finance a private home loan advance for a man

Definitions Residential Mortgage Loan Any advance basically for individual, family, or family utilize that is secured by a home loan, deed of trust, or other equal consensual security enthusiasm on a home as characterized in Reg Z or private enduring property whereupon is developed or expected to be built an abode as characterized in Reg Z

Residential Mortgage Loan Now covers all advances secured by a people staying including: Mobile home advances without a security enthusiasm for the land Motor homes utilized as the individual's home Boats if utilized as the individual's home Vacant land if to be utilized to build or move a man's habitation on it

Definitions Registered Mortgage Loan Originator A person who meets the meaning of a home loan advance originator and is a representative of a vault organization or a backup that is either possessed and controlled by a store foundation and directed by a government managing an account office or an establishment controlled by the Farm Credit Administration and is enlisted with, and keeps up a one of a kind identifier through, the Nationwide Mortgage Licensing System & registry.

R.S. 6:1084 No individual, straightforwardly or in a roundabout way, should take part in a private home loan loaning movement without conforming to the Louisiana S.A.F.E. Private Mortgage Lending Act or principles and directions proclaimed in accordance with thereof

R.S. 6:1086 Beginning July 31, 2009, unless generally absolved, no individual might take part in private home loan loaning movement without first acquiring and keeping up every year: A permit and enrollment as a home loan advance originator, or a permit as a home loan moneylender or handle A one of a kind identifier in the NMLS&R

R.S. 6:1086 The accompanying people might have until July 31, 2010 to acquire a permit in consistence with the Act: A man whose exercises were not subject to the permitting arrangements of this Act on July 30, 2009 A man occupied with private home loan loaning exercises which was liable to an exclusion gave by this Chapter on July 30, 2009

Originator Exemptions Registered home loan advance originators, when representing a storehouse foundation A person who offers or arranges terms of a private home loan advance with or for the benefit of a close relative An authorized lawyer who arranges the terms of a private home loan advance in the interest of a customer as a subordinate matter to the portrayal of the customer unless the lawyer is repaid by a bank, a home loan merchant, or other home loan originator including any specialists of such

Originator Exemptions Any person who performs just land financier exercises and is authorized given they are not remunerated by a moneylender, contract intermediary, or other home loan originator or any of their operators Any individual drew in exclusively in augmentations of credit including timeshares Individuals who are workers of a retailer of produced or particular homes performing just administrative obligations which get no pay or pick up from a home loan representative or loan specialist A person who offers or arranges terms of a home loan advance secured by an abode that is possessed by and fills in as the individual's home

Originator Exemptions Loan Processor or Underwriter An individual drawing in exclusively in advance processor or endorsing exercises, who does not speak to general society, through publicizing or different means including the utilization of business cards, stationary, leaflets, signs, rate records, or other limited time things, that such individual can or ledge play out any of the exercises of a home loan originator. Characterized as a man who performs administrative or bolster obligations as a worker at the course of and subject to the supervision of a man permit or absolved from the Act.

Originator Exemptions Loan Processor or Underwriter Clerical or Support Duties incorporate ensuing to receipt of an application: Receipt, accumulation, conveyance, and examination or data regular for the preparing or guaranteeing of a private home loan advance Communicating with a shopper to get the data essential for the handling or endorsing of an advance, to the degree that such correspondence does exclude offering or arranging advance rates or terms, or advising purchasers about private advance rates or terms

Originator Exemptions Loan Processor or Underwriter DO NOT APPLY TO: Independent temporary worker advance processors or financiers They should acquire an originator permit and a special identifier issued by the NMLS&R

Mortgage Broker/Lender Exemptions Depository Institutions or immediate or circuitous auxiliaries including their representatives Exempt from licensure Still subject to necessity of Part III

Direct & Indirect Subsidiaries Depository Institutions Proposed definitions: Direct Subsidiary - any firm, partnership, affiliation, trust, or lawful element which is 100 percent possessed by a bank, reserve funds bank, investment funds and advance affiliation, or credit union. Circuitous Subsidiary - any firm, enterprise, affiliation, trust, or lawful element which is 100 percent possessed by an immediate auxiliary as characterized above, and any firm, organization, affiliation, put stock in, lawful substance, association, or restricted obligation organization which is 100 percent claimed by a bank, reserve funds bank, investment funds and advance affiliation, or credit union, and one or more straightforward backups as characterized previously.

Mortgage Broker/Lender Exemptions Mortgagees which are the previous proprietor of the home or private unflinching property Insurance organization or specialist which holds a present maker permit and dealers advances solely to a safety net provider Both still subject to Part III of Act

Mortgage Broker/Lender Exemptions Licensed Attorneys When action is coincidental to giving legitimate administrations Exempt from licensure Still subject to Part III

Mortgage Broker/Lender Exemptions Any not for benefit 501(c) company making advances to advance home possession or enhancements for the distraught Exempt from licensure Still subject to Part III

Mortgage Broker/Lender Exemptions Any Real Estate Investment Trust Small Business speculation Companies authorized by SBA Both Still subject to Part III

Requirements for Licensing Fingerprints and charge for record verification Personal history and experience submitted through the NMLS&R Authorization and expense for acquiring a credit report Information required for proprietors, individuals, or accomplices For enterprise each 10% or more prominent shareholder

Requirements for Licensing Demonstrate money related obligation, character, and general wellness to warrant an assurance that the candidate will work truly, decently and effectively inside the reasons for this Chapter. Finish 20 hours of pre-authorizing instruction affirmed by NMLS&R additionally at least each of the accompanying 3 hours of elected law and directions 3 hours of morals including misrepresentation, customer insurance, and reasonable loaning 2 hours of preparing identifying with non-conventional home loan commercial center Pass a composed examination with both national and state parts Obtain and keep up a surety bond Originators might be secured by a Surety Bond got by their boss

Restrictions on conceding Licenses Paid all charges due to OFI Never had a home loan related permit denied in any administrative ward Never sentenced, pled blameworthy, or nolo contendere to a lawful offense including extortion, d