Maine and Nebraska Legislative Update

Maine and Nebraska Legislative Update

The Maine legislature recently amended the Maine Secure and Fair Enforcement for Mortgage Licensing Act of 2009 (“Maine SAFE Act”), effective September 17, 2013, and the Nebraska legislature recently amended the Residential Mortgage Licensing Act (the “Act”), effective September 5, 2013.

MAINE LEGISLATIVE DOCUMENT 1203/HOUSE PAPER 847

 

 

An individual, unless specifically exempted from the Maine SAFE Act, may not engage in the business of a mortgage loan originator without obtaining and maintaining annually a license.

 

 

“Engaging in the business of a mortgage loan originator” means the individual, in a commercial context and habitually or repeatedly:

  • Takes a residential mortgage loan application and offers or negotiates terms of a residential mortgage loan for compensation or gain; or
  • Represents to the public, through advertising or other means of communicating or providing information, including the use of business cards, stationery, brochures, signs, rate lists, or other promotional items, that the individual can or will perform the activities described above.

 

An individual is considered to be acting habitually or repeatedly if the individual takes a residential mortgage application and offers or negotiates terms of a residential mortgage loan for compensation or gain more than 3 times in a 12-month period.  An exemption from the licensure requirements under the Maine SAFE Act does not apply if the individual, alone or with others, is found by the Superintendent of Financial Institutions (the “Administrator”) to have acted so as to intentionally circumvent or evade the above provisions.

 

 

The following are now exempt from the Maine SAFE Act:

  • An individual who acts as a mortgage loan originator in providing financing for the sale of a property owned by that individual as long as that individual does not habitually or repeatedly engage in that activity.
  • An individual who acts as a mortgage loan originator as long as the source of prospective financing does not provide mortgage financing or perform other mortgage loan origination activities habitually or repeatedly.
  • An employee of a government entity who acts as a mortgage loan originator pursuant to that employee’s official duties as an employee of that government entity.

NEBRASKA SENATE BILL 290

 

 

A licensee licensed as a mortgage banker must notify the Director of Banking and Finance (the “Director”) in writing or through the Nationwide Mortgage Licensing System and Registry (the “NMLS”):

  • Within three business days after the occurrence of any of the following:
    • Any other state or jurisdiction begins license denial, cease and desist, suspension, or revocation procedures against the licensee;
    • The attorney general of any state, the Consumer Financial Protection Bureau (the “CFPB”), or the Federal Trade Commission (the “FTC”) begins an action to enforce consumer protection laws against the licensee or any of the licensee’s officers, directors, shareholders, partners, members, employees, or agents; or
    • Fannie Mae, Freddie Mac, the Federal Housing Administration (“FHA”), or Ginnie Mae suspends or ends the licensee’s status as an approved seller or seller and servicer; and
  • Within 30 days after the occurrence of a material development including, but not limited to, any of the following:
    • The relocation or closing of a branch office; or
    • The entry of an order against the licensee or any of the licensee’s officers, directors, shareholders, partners, members, employees, or agents, including orders to which the licensee or other parties agreed, by any other state or federal regulator.

 

A licensee licensed as a mortgage loan originator must notify the Director in writing or through the NMLS within three business days after any of the following occur:

  • The filing of a voluntary petition in bankruptcy by the licensee or notice of a filing of an involuntary petition in bankruptcy against the licensee;
  • The filing of a criminal indictment or information against the licensee regarding a misdemeanor under state or federal law which involves dishonesty or fraud or which involves any aspect of the mortgage banking business, depository institution business, or installment loan company business or any felony under state or federal law;
  • The licensee was convicted of, pled guilty to, or was found guilty after a plea of no contest to a misdemeanor under state or federal law which involves dishonesty or fraud or which involves any aspect of the mortgage banking business, depository institution business, or installment loan company business or any felony under state or federal law;
  • Any other state or jurisdiction begins license denial, cease and desist, suspension, or revocation procedures against the licensee;
  • The attorney general of any state, the CFPB, or the FTC begins an action to enforce consumer protection laws against the licensee; or
  • Fannie Mae, Freddie Mac, the FHA, or Ginnie Mae suspends or ends the licensee’s status as an approved loan originator.

 

A licensee licensed as a mortgage loan originator must update through the NMLS his or her employment history on file with the Department of Banking and Finance no later than ten business days after the submission of the required notice of the beginning or end of an employment relationship.

 

 

A licensee licensed as a mortgage loan originator must notify the Director in writing or through the NMLS within 30 days after the occurrence of a material development including, but not limited to, any of the following:

  • A change in the licensee’s name;
  • A change in the licensee’s residential address;
  • A change in the licensee’s employment address;
  • The filing of a tax or other governmental lien against the licensee;
  • The entry of a monetary judgment against the licensee; or
  • The entry of an order against the licensee, including orders to which the licensee consented, by any other state or federal regulator.

 

In conducting an examination or investigation, the Director may rely on reports made by a person licensed under the Act as a mortgage banker or mortgage loan originator or a registrant that have been prepared within the last 12 months for the CFPB.