75th OREGON LEGISLATIVE ASSEMBLY--2009 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 359
A-Engrossed
House Bill 2189
Ordered by the House May 1
Including House Amendments dated May 1
Ordered printed by the Speaker pursuant to House Rule 12.00A (5).
Presession filed (at the request of Governor Theodore R.
Kulongoski for Department of Consumer and Business Services)
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure.
{ - Authorizes Director of Department of Consumer and
Business Services to license mortgage bankers and mortgage
brokers in cooperation with Nationwide Mortgage Licensing System
and Registry. Requires director to adopt rules necessary to
conform with requirements of federal Housing and Economic
Recovery Act of 2008. - }
{ - Requires person that is licensed as mortgage banker or
mortgage broker, person that applies for mortgage banker's or
mortgage broker's license or other person that employs loan
originator to maintain bond or letter of credit. Requires person
to keep certain records and to maintain records for loan
originators through Nationwide Mortgage Licensing System and
Registry. - }
{ - Sets educational and testing requirements for obtaining
or renewing loan originator's license and requires submission of
certain information for criminal records check. - }
{ - Requires loan originator to be licensed under Nationwide
Mortgage Licensing System and Registry and obtain unique
identifier. - }
{ - Specifies grounds on which director may deny, suspend,
condition or revoke mortgage banker's, mortgage broker's or loan
originator's license. - }
{ + Prohibits individual from engaging in business as
mortgage loan originator without obtaining license from Director
of Department of Consumer and Business Services and obtaining
unique identifier from Nationwide Mortgage Licensing System and
Registry.
Requires applicant for license to submit certain information to
director and to Nationwide Mortgage Licensing System and
Registry. Specifies standards director must use to evaluate
application. Permits director to issue interim license under
certain conditions.
Specifies requirements for applicant to obtain or renew
license, including educational requirements.
Authorizes director to deny, suspend, place conditions upon,
revoke or decline to renew license under specified conditions.
Permits director to contract with Nationwide Mortgage Licensing
System and Registry to collect and process records, application
fees and perform other duties.
Requires person that employs mortgage loan originator to file
corporate surety bond with director in amount director prescribes
by rule.
Authorizes director to investigate violations of provisions of
Act and require production of specified records.
Provides that mortgage loan originator may not take certain
actions. Requires mortgage loan originator to display license and
unique identifier on specified documents and in certain
locations.
Provides that person that violates provisions of Act is subject
to civil penalty in amount of $5,000 per violation and to maximum
criminal penalty of five years' imprisonment, or $125,000 fine,
or both. + }
Declares emergency, effective on passage.
A BILL FOR AN ACT
Relating to regulation of mortgage professionals; creating new
provisions; amending ORS 59.840, 59.850, 59.855, 59.860,
59.865, 59.875, 59.880, 59.900, 59.905, 59.925, 59.962, 59.967,
59.971, 59.972, 59.992, 446.691, 446.696, 446.706, 446.741,
725.010, 725.140 and 725.230; repealing ORS 59.969, 59.970,
59.973, 59.975 and 59.977; and declaring an emergency.
Whereas the activities of mortgage loan originators and the
origination or offer of financing for real property have a
direct, valuable and immediate impact on consumers, on the
economy, neighborhoods and communities of this state and on the
housing and real estate industry; and
Whereas access to mortgage credit is vital to the citizens of
this state; and
Whereas reasonable standards to license and regulate the
business practices of mortgage loan originators are essential to
protect the citizens of this state and the stability of this
state's economy; and
Whereas the Legislative Assembly therefore declares that the
purpose of sections 1 to 13 of this 2009 Act is to protect
consumers that seek mortgage loans and to ensure that the
mortgage lending industry operates without unfair, deceptive or
fraudulent practices among mortgage loan originators; now,
therefore,
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + As used in sections 1 to 13 of this 2009 Act:
(1) 'Depository institution' means a depository institution, as
defined in 12 U.S.C. 1813(c), and a credit union, as defined in
ORS 723.008.
(2) 'Federal banking agency' means:
(a) The Board of Governors of the Federal Reserve System;
(b) The Comptroller of the Currency;
(c) The Director of the Office of Thrift Supervision in the
United States Department of the Treasury;
(d) The National Credit Union Administration Board; and
(e) The Board of Directors of the Federal Deposit Insurance
Corporation.
(3)(a) 'Loan processor or underwriter' means an individual who,
after receiving an application, performs clerical or support
duties that include:
(A) Receiving, collecting, distributing and analyzing
information commonly used in processing or underwriting a
residential mortgage loan; or
(B) Communicating with a consumer to obtain information
necessary to process or underwrite a residential mortgage loan.
(b) 'Loan processor or underwriter' does not include an
individual who communicates with a consumer for the purpose of
offering or negotiating residential mortgage loan terms with the
consumer or offering counsel or consultation to the consumer
concerning residential mortgage loan terms or rates.
(4)(a) 'Mortgage loan originator' means an individual who, for
compensation or gain:
(A) Takes an application for a residential mortgage loan; or
(B) Offers or negotiates terms for a residential mortgage loan.
(b) 'Mortgage loan originator' does not include:
(A) An individual who, as an employee or independent
contractor, works solely as a loan processor or underwriter;
(B) A person that performs professional real estate activities,
as defined in ORS 696.010, unless the person is compensated by a
mortgage banker, mortgage broker, mortgage loan originator or
lender or an agent of a mortgage banker, mortgage broker,
mortgage loan originator or lender;
(C) An individual that extends credit solely in connection with
a timeshare plan, as defined in 11 U.S.C. 101(53D); or
(D) An individual who:
(i) Is employed by a person that is licensed by the Director of
the Department of Consumer and Business Services; and
(ii) Collects or receives payments on behalf of a person that
holds a residential mortgage, including payments of principal,
interest, escrow amounts and other amounts due on obligations
that under the terms of the note are due and owed to the person
that holds the residential mortgage.
(5) 'Nationwide Mortgage Licensing System and Registry ' means
a system that the Conference of State Bank Supervisors and the
American Association of Residential Mortgage Regulators maintain
to register and license mortgage loan originators.
(6) 'Nontraditional mortgage' means a mortgage other than a
30-year fixed-rate mortgage or a mortgage that the director by
rule defines as a nontraditional mortgage.
(7) 'Registered mortgage loan originator' means an individual
who:
(a) Is employed by:
(A) A depository institution;
(B) A subsidiary of a depository institution that is regulated
by a federal banking agency; or
(C) An institution that is regulated by the Farm Credit
Administration;
(b) Performs the duties of a mortgage loan originator; and
(c) Complies with the registration requirements set forth in 12
U.S.C. 5106.
(8) 'Residential mortgage loan' means a loan that is secured by
a mortgage, deed of trust or equivalent consensual security
interest on four or fewer residential dwelling units, including
but not limited to individual dwelling units, mobile homes,
condominiums or cooperatives that are planned for or situated on
real property in this state.
(9) 'Unique identifier' means a number or other means of
identification that is assigned by or under protocols established
by the Nationwide Mortgage Licensing System and Registry. + }
SECTION 2. { + (1) Except as provided in subsection (2) of
this section, an individual may not engage in business as a
mortgage loan originator in this state without first:
(a) Obtaining and maintaining a mortgage loan originator's
license under section 4 of this 2009 Act or renewing a mortgage
loan originator's license under section 6 of this 2009 Act; and
(b) Obtaining a unique identifier from the Nationwide Mortgage
Licensing System and Registry.
(2) Subsection (1) of this section does not apply to:
(a) A registered mortgage loan originator who acts within the
scope of the registered mortgage loan originator's employment;
(b) An individual who offers or negotiates terms of a
residential mortgage loan with or on behalf of the individual's
spouse, child, sibling, parent, grandparent, grandchild or a
relative in a similar relationship with the individual that is
created by law, marriage or adoption;
(c) An individual who offers or negotiates terms of a
residential mortgage loan that is secured by a dwelling that
served as the individual's residence; or
(d) An attorney licensed or otherwise authorized to practice
law in this state if the attorney:
(A) Negotiates the terms of a residential mortgage loan as an
ancillary matter in the attorney's representation of a client;
and
(B) Does not receive compensation from a mortgage banker,
mortgage broker, mortgage loan originator or lender or an agent
of the mortgage banker, mortgage broker, mortgage loan originator
or lender.
(3) The director by rule may exempt a person from the
requirement to obtain a mortgage loan originator's license under
sections 1 to 13 of this 2009 Act if the United States Department
of Housing and Urban Development requires or permits the
exemption under 12 U.S.C. 5101 et seq. + }
SECTION 3. { + (1) The Director of the Department of Consumer
and Business Services by rule shall determine the manner in which
an applicant must apply and the form and contents of an
application for a license to conduct business as a mortgage loan
originator.
(2) In connection with an application under this section, an
applicant shall apply for and receive a unique identifier from
the Nationwide Mortgage Licensing System and Registry. As part of
the application, the director by rule shall require the applicant
to submit to the director or directly to the Nationwide Mortgage
Licensing System and Registry:
(a) Fingerprints that the Federal Bureau of Investigation, or
another government agency that is authorized to receive
fingerprints, can use to perform a state, national and
international criminal background check;
(b) A summary of the applicant's personal history and
experience on a form prescribed by the Nationwide Mortgage
Licensing System and Registry;
(c) A document that authorizes the Nationwide Mortgage
Licensing System and Registry to obtain, with reference to the
applicant:
(A) A credit report from a consumer reporting agency, as
defined in 15 U.S.C. 1681a(f), or a consumer reporting agency
that compiles and maintains files on consumers on a nationwide
basis, as defined in 15 U.S.C. 1681a(p); and
(B) Information about administrative, civil or criminal
proceedings and findings concerning the applicant in any
governmental jurisdiction; and
(d) Other information the director or the Nationwide Mortgage
Licensing System and Registry may require. + }
SECTION 3a. { + The Director of the Department of Consumer and
Business Services may issue an interim mortgage loan originator's
license to a person that is not licensed under section 4 of this
2009 Act if the director finds that issuing the interim license
will facilitate the business of licensed mortgage loan
originators or prevent an undue delay in issuing a mortgage loan
originator's license. The director may specify the term of the
interim mortgage loan originator's license and may issue the
interim license to an applicant for a mortgage loan originator's
license only if the director finds that the applicant:
(1) Is employed by a person that has a valid license or
registration from the Department of Consumer and Business
Services;
(2) Substantially meets the requirements of sections 3, 4 and 5
of this 2009 Act as of the operative date of this section; and
(3) Has not committed an act prohibited under section 12 of
this 2009 Act. + }
SECTION 4. { + (1) The Director of the Department of Consumer
and Business Services may not issue a mortgage loan originator's
license to an applicant unless the director finds, at a minimum,
that the applicant:
(a) Has obtained a unique identifier from the Nationwide
Mortgage Licensing System and Registry.
(b) Has not had a mortgage loan originator's license revoked in
another jurisdiction. For purposes of this paragraph, an
applicant's mortgage loan originator's license was not revoked if
an order or decision to revoke the license was later rescinded or
vacated.
(c) Has not been convicted of or pleaded guilty or no contest
in a state, federal, foreign or military court to a felony or to
a misdemeanor if an essential element of the misdemeanor involved
false statements or dishonesty:
(A) During a period of seven years before the date the
applicant submits an application under section 3 of this 2009
Act; or
(B) At any time before the date the applicant submits an
application under section 3 of this 2009 Act, if the conviction
or plea involved a felony and an element of the felony was an act
of fraud, dishonesty, a breach of trust or laundering a monetary
instrument. For purposes of this paragraph, a conviction that was
later pardoned is not a conviction.
(d) Has demonstrated financial responsibility sufficient to
command the confidence of the community and warrant the
determination that the applicant will operate honestly, fairly
and efficiently within the purposes of sections 1 to 13 of this
2009 Act.
(e) Has completed the education requirement set forth in
section 5 of this 2009 Act and passed a test that meets the
standards set forth in section 5 of this 2009 Act.
(f) Is covered by a surety bond in accordance with the
provisions of section 9 of this 2009 Act.
(2) The director may not:
(a) Deny a mortgage loan originator's license to an applicant
because of the applicant's credit score; or
(b) Use information in a credit report as the sole basis for
denying the mortgage loan originator's license.
(3) The director shall issue a mortgage loan originator's
license to an applicant if:
(a) The director is satisfied that the information contained in
the application for a mortgage loan originator's license is
accurate and complete; and
(b) No reason exists under subsection (1) of this section to
deny the applicant a mortgage loan originator's license.
(4) The director by rule may specify criteria for determining
financial responsibility under subsection (1)(d) of this
section. + }
SECTION 5. { + (1) An applicant for a mortgage loan
originator's license shall:
(a) Complete, at a minimum, 20 hours of an approved course of
prelicensing education that, at a minimum, must include:
(A) Three hours devoted to federal laws and regulations;
(B) Three hours devoted to ethics, with instruction concerning
fraud, consumer protection and fair lending; and
(C) Two hours devoted to lending standards applicable to
nontraditional mortgages; and
(b) Pass a qualified written test with a score of 75 percent
correct or better. The test must measure the applicant's
knowledge of:
(A) Ethics; and
(B) Federal and state laws, regulations and rules that apply to
residential mortgage loan origination, including laws,
regulations and rules that concern fraud, consumer protection,
fair lending and nontraditional mortgages.
(2) For purposes of this section:
(a) An approved course of prelicensing education is a course
that the Nationwide Mortgage Licensing System and Registry has
reviewed and for which the Nationwide Mortgage Licensing System
and Registry has approved the contents, provider, instructional
standards and means and methods of delivery, using reasonable
standards.
(b) A qualified written test is a test that the Nationwide
Mortgage Licensing System and Registry develops and for which the
Nationwide Mortgage Licensing System and Registry approves the
test provider and method of test administration, using reasonable
standards.
(3) The director shall accept for the purposes of the
requirements set forth in subsection (1) of this section an
approved course of prelicensing education that an applicant
completed in another state.
(4) This section does not preclude:
(a) An applicant's employer or a subsidiary, agent or affiliate
of the employer from providing an approved course of prelicensing
education; or
(b) An approved test provider from administering a qualified
test at the business location of the applicant's employer or an
affiliate, subsidiary or agent of the employer or at the business
location of a person with which the employer has an exclusive
contractual arrangement related to mortgage loan origination.
(5) An applicant may take a qualified test four consecutive
times, provided that each test administration occurs 30 days
after a previous test administration. If the applicant fails the
approved test four consecutive times, the applicant must wait at
least six months before retaking the test. + }
SECTION 6. { + (1) The Director of the Department of Consumer
and Business Services shall renew a mortgage loan originator's
license if the director finds that:
(a) The licensed mortgage loan originator continues to meet the
requirements set forth under section 4 of this 2009 Act;
(b) The licensed mortgage loan originator paid the fee required
to renew the mortgage loan originator's license; and
(c) The licensed mortgage loan originator satisfied the
continuing education requirements set forth in section 7 of this
2009 Act. If the licensed mortgage loan originator did not
satisfy the requirements under section 7 of this 2009 Act,
instead of declining to renew the mortgage loan originator's
license, the director by rule or order may permit or require the
licensed mortgage loan originator to make up the deficiency in
continuing education.
(2)(a) A mortgage loan originator's license expires if:
(A) The licensed mortgage loan originator does not apply to
renew the mortgage loan originator's license;
(B) The director declines to renew the mortgage loan
originator's license; or
(C) The licensed mortgage loan originator does not otherwise
maintain eligibility under the requirements set forth in sections
1 to 13 of this 2009 Act.
(b) The director by rule may establish a procedure and
requirements for reinstating a license that has expired. The
procedure and requirements the director establishes must be
consistent with standards established by the Nationwide Mortgage
Licensing System and Registry and must at a minimum provide that
an applicant for reinstatement who has allowed the applicant's
mortgage loan originator's license to lapse for a period of five
or more years, whether or not the applicant was employed or
continued to engage in business as a mortgage loan originator
during the period of the lapse, shall:
(A) Demonstrate to the director that the applicant completed
the continuing education requirements set forth in section 7 of
this 2009 Act that were required in the year in which the
applicant last held a mortgage loan originator's license; and
(B) Pass the qualified written test as provided in section 5 of
this 2009 Act. + }
SECTION 7. { + (1) A licensed mortgage loan originator each
year shall complete at least eight hours of an approved course of
continuing education that, at a minimum, must include:
(a) Three hours devoted to federal laws and regulations;
(b) Two hours devoted to ethics, with instruction concerning
fraud, consumer protection and fair lending; and
(c) Two hours devoted to lending standards applicable to
nontraditional mortgages.
(2) For purposes of this section, an approved course of
continuing education is a course that the Nationwide Mortgage
Licensing System and Registry has reviewed and for which the
Nationwide Mortgage Licensing System and Registry has approved
the contents, provider, instructional standards and means and
methods of delivery, using reasonable standards.
(3) This section does not preclude a licensed mortgage loan
originator's employer or a subsidiary, agent or affiliate of the
employer from providing an approved course of continuing
education.
(4) The Director of the Department of Consumer and Business
Services shall accept for the purposes of the requirement set
forth in subsection (1) of this section an approved course of
continuing education that a licensed mortgage loan originator
completed in another state.
(5) A licensed mortgage loan originator:
(a) May receive credit for a continuing education course only
in the year in which the licensed mortgage loan originator takes
the course, unless the director under section 6 of this 2009 Act
permits or requires the mortgage loan originator to make up a
deficiency in continuing education; and
(b) May not for the purposes of meeting the requirement set
forth in subsection (1) of this section take the same approved
course of continuing education in the same year or in any two
successive years.
(6) A licensed mortgage loan originator who is also approved as
an instructor for an approved course of continuing education may
receive two hours of credit toward the licensed mortgage loan
originator's own continuing education requirement for each hour
of the approved course of continuing education that the licensed
mortgage loan originator teaches. + }
SECTION 8. { + (1) In addition to authority the Director of
the Department of Consumer and Business Services has under ORS
59.840 to 59.980, the director under this section has the
authority, subject to ORS chapter 183, to deny, suspend, place
conditions upon, revoke or decline to renew a mortgage loan
originator's license or permanently prohibit a person from
conducting business as a mortgage loan originator if:
(a) A licensed mortgage loan originator violates a provision of
sections 1 to 13 of this 2009 Act or a rule or order the director
issues under sections 1 to 13 of this 2009 Act;
(b) The director makes a finding under section 4 or 6 of this
2009 Act that the director believes justifies a decision to deny
or decline to renew a mortgage loan originator's license;
(c) An applicant makes a false statement or a material
misstatement of fact on an application for a mortgage loan
originator's license or a licensed mortgage loan originator makes
a false statement or a material misstatement of fact on an
application to renew a mortgage loan originator's license; or
(d) A person who is not exempted from the requirement to obtain
a mortgage loan originator's license under section 2 (2) of this
2009 Act conducts business as a mortgage loan originator without
applying for and receiving a mortgage loan originator's license
under sections 3 and 4 of this 2009 Act.
(2) The director, subject to ORS chapter 183, may order a
person that is subject to regulation under sections 1 to 13 of
this 2009 Act to:
(a) Cease and desist immediately or permanently from violating
a provision of sections 1 to 13 of this 2009 Act or from an act
or practice related to mortgage loan origination that the
director deems harmful to a consumer or to the public;
(b) Stop or suspend business related to mortgage loan
origination;
(c) Pay restitution to a consumer or another person that the
director finds suffered harm from the person's acts, omissions,
practices or operations or as a result of the person's violation
of a provision of sections 1 to 13 of this 2009 Act; or
(d) Take or refrain from taking an action the director deems
necessary to comply with sections 1 to 13 of this 2009 Act.
(3)(a) The director, in accordance with ORS 183.745, may impose
a civil penalty in an amount not to exceed $5,000 for each
separate instance of a violation of or failure to comply with the
provisions of sections 1 to 13 of this 2009 Act or a rule or
order the director adopted or issued under sections 1 to 13 of
this 2009 Act.
(b) Every violation described in paragraph (a) of this
subsection is a separate offense that is subject to a separate
penalty. Each day in which the same violation occurs is a
separate violation. A violation that continues for more than one
day is a continuing violation that is subject to a maximum
penalty of $20,000.
(4)(a) A person may not knowingly:
(A) Violate a provision of section 2 of this 2009 Act;
(B) Fail to comply with an order the director issues under this
section;
(C) Fail to produce records at the director's request under
section 11 of this 2009 Act;
(D) Employ a device, scheme or artifice to defraud or engage in
an act, practice or course of business that operates or would
operate as a fraud or deceit;
(E) Make an untrue statement of a material fact or omit from a
statement a material fact that would make the statement not
misleading in light of the circumstances under which the person
makes the statement; or
(F) Make or file or cause to be made or filed with the director
a statement, report or document that the person knows is false in
a material respect or matter.
(b) A person who takes an action described in paragraph (a) of
this subsection commits a Class C felony. + }
SECTION 9. { + (1) A person that employs a mortgage loan
originator shall file with the Director of the Department of
Consumer and Business Services a corporate surety bond that runs
to the State of Oregon and that covers each mortgage loan
originator the person employs. The corporate surety bond must be
issued by a corporate surety or an insured institution, as
defined in ORS 706.008, that is authorized to transact business
in this state.
(2) The director by rule shall:
(a) Prescribe the form of the corporate surety bond;
(b) Require the person to maintain the corporate surety bond in
an amount that reflects the dollar amount of the loans the person
originated or in a minimum amount the director specifies; and
(c) Prescribe other requirements for the corporate surety bond
as are necessary to accomplish the purposes of sections 1 to 13
of this 2009 Act.
(3) A right of action against the corporate surety bond
required under this section exists to the same extent that a
right of action exists under ORS 59.925.
(4) The director may require the person to file a new corporate
surety bond if an action is commenced against the corporate
surety bond on file with the director. The person shall file a
new corporate surety bond immediately if a recovery is obtained
against the bond. + }
SECTION 10. { + (1) The Director of the Department of Consumer
and Business Services may contract with or otherwise agree with
the Nationwide Mortgage Licensing System and Registry, or a
person the Nationwide Mortgage Licensing System and Registry
designates, to:
(a) Collect and maintain records in connection with an
application under section 4 or 6 of this 2009 Act;
(b) Collect and process application fees or other fees that are
authorized under sections 1 to 13 of this 2009 Act and imposed by
a government agency or association of government agencies;
(c) Serve as a point of contact the director may use to request
information from and provide information to the United States
Department of Justice, the Federal Bureau of Investigation or
other government agencies;
(d) Apply, abide by and implement standards the Nationwide
Mortgage Licensing System and Registry establishes for:
(A) Setting or resetting dates for reporting information or
renewing a mortgage loan originator's license; and
(B) Amending or surrendering a mortgage loan originator's
license; and
(e) Otherwise participate in the Nationwide Mortgage Licensing
System and Registry.
(2) The director may agree with the Conference of State Bank
Supervisors, the American Association of Residential Mortgage
Regulators or other government agencies or associations of
government agencies to share and to maintain under subsection (4)
of this section the confidentiality or privilege applicable to
information or material that:
(a) An applicant provides under section 3 of this 2009 Act;
(b) A mortgage loan originator provides under section 6 of this
2009 Act; or
(c) The director obtains from investigations, inquiries,
proceedings, submissions or other sources under the authority of
sections 1 to 13 of this 2009 Act.
(3) The director shall provide copies of information and
material that the director supplies to or receives from the
Nationwide Mortgage Licensing System and Registry to an applicant
for a mortgage loan originator's license under section 4 of this
2009 Act or to a licensed mortgage loan originator who applies to
renew a license under section 6 of this 2009 Act. The director by
rule shall establish a procedure for challenging the accuracy or
completeness of the information and materials.
(4)(a) Except as provided in subsections (5) and (6) of this
section and 12 U.S.C. 5111, information or material that an
applicant, a mortgage loan originator or the director provides or
discloses to the Nationwide Mortgage Licensing System and
Registry retains the confidentiality or privilege from public
disclosure that applies to the information under ORS 192.410 to
192.505 or under other applicable state or federal law, including
court rules. The confidentiality or privilege applies to the
information or material despite disclosure to state or federal
agencies with regulatory authority over persons, businesses or
activities related to mortgage lending.
(b) Information that is subject to a privilege described in
paragraph (a) of this subsection is not subject to:
(A) Disclosure under state or federal law that governs
disclosure of information in the possession of a public official;
or
(B) Subpoena, discovery or admission into evidence in an
administrative proceeding or private civil action, unless the
person whose information is protected by the confidentiality or
privilege waives the confidentiality or privilege in whole or in
part.
(c) To the extent that the provisions of ORS 192.410 to 192.505
conflict with the provisions of this section, the provisions of
this section control.
(5) Subsection (4) of this section does not apply to
information or material concerning an applicant's or a mortgage
loan originator's employment history or records of discipline and
enforcement actions that appear in and are open to public access
in the Nationwide Mortgage Licensing System and Registry. The
director may publish on the Internet information that the
director receives from the Nationwide Mortgage Licensing System
and Registry that is not subject to a privilege described in
subsection (4) of this section.
(6) The director shall regularly report to the Nationwide
Mortgage Lending System and Registry violations of the provisions
of sections 1 to 13 of this 2009 Act, enforcement actions against
a person subject to sections 1 to 13 of this 2009 Act and other
information the director deems necessary to meet the director's
obligations under agreements with the Nationwide Mortgage
Licensing System and Registry.
(7) To the extent reasonably necessary to participate in the
Nationwide Mortgage Licensing System and Registry, the director
by rule or order may waive or modify, in whole or in part, the
requirements set forth in sections 1 to 13 of this 2009 Act or
establish new requirements consistent with the provisions of
sections 1 to 13 of this 2009 Act. + }
SECTION 11. { + (1) The Director of the Department of Consumer
and Business Services, as often as the director deems necessary
to carry out the purposes of sections 1 to 13 of this 2009 Act,
may:
(a) Request or require a person that employs a mortgage loan
originator or that under the provisions of sections 1 to 13 of
this 2009 Act should employ a mortgage loan originator to
produce, for the director's examination and use, books, accounts,
records, files, documents or other information or evidence;
(b) Investigate or examine an applicant or a licensed mortgage
loan originator and review the applicant's or licensed mortgage
loan originator's:
(A) History of criminal, civil and administrative proceedings,
enforcement actions, arrests or other information related to the
applicant's or licensed mortgage loan originator's compliance
with state and federal law, rules or regulations; and
(B) Personal history and experience, including information
obtained from credit reports from a consumer reporting agency, as
defined in 15 U.S.C. 1681a(f) or from a consumer reporting agency
that compiles and maintains files on consumers on a nationwide
basis, as defined in 15 U.S.C. 1681a(p);
(c) Direct, subpoena, examine, compel the attendance of,
administer oaths and affirmations to, and request production of
books, accounts, records, files, documents or other information
or evidence from witnesses and persons that are subject to
regulation under sections 1 to 13 of this 2009 Act; and
(d) Interview and take and preserve testimony concerning
business practices and operations from the applicant's or
licensed mortgage loan originator's officers, principals,
mortgage loan originators, employees, agents and customers or
independent contractors associated with the applicant or licensed
mortgage loan originator.
(2)(a) The director may, with reference to documents, materials
or records described in subsection (1) of this section:
(A) Take possession of, sequester, control or restrict access
to the documents, materials or records; or
(B) Designate a person to take exclusive charge of the
documents, materials or records in the location in which the
documents, materials or records are usually kept.
(b) At a time in which the director has taken an action
described in paragraph (a) of this subsection, a person may not,
without the director's permission or a court order, remove or
attempt to remove the documents, materials or records from the
director's possession or control or from the location in which
the documents, materials or records are kept under the exclusive
charge of the person the director designates.
(c) A person who owns or has a right to possess or control the
documents, materials or records may have access necessary to
conduct the person's ordinary business, unless the director
reasonably believes that the documents, materials or records have
been or are at risk of alteration or destruction for the purposes
of concealing a violation of sections 1 to 13 of this 2009 Act.
(3) In carrying out the purposes of this section, the director
may:
(a) Retain attorneys, accountants or other professionals or
specialists to conduct investigations, audits or examinations or
assist in conducting investigations, audits or examinations;
(b) Agree with other government agencies or officials to share
resources, information, methods, procedures, documents, records,
materials and information obtained in the course of
investigations, audits, examinations and related activities;
(c) Purchase, share, use or employ analytical systems, methods
or software available from public or private sources;
(d) Accept and rely upon the results of or reports concerning
investigations, audits, examinations or proceedings conducted by
other government agencies or officials in this state or in other
states; and
(e) Accept, use and incorporate in the director's findings,
reports, orders or other actions audit reports from an
independent certified public accountant.
(4) The director's authority under this section applies to a
person who is subject to regulation under sections 1 to 13 of
this 2009 Act, whether or not the person is licensed as a
mortgage loan originator.
(5) An applicant or licensed mortgage loan originator shall:
(a) Make available to the director at the director's request
books, accounts, records, files and other documents relating to
the applicant's or licensed mortgage loan originator's business
operations and practices; and
(b) Prepare, compile and deliver to the director reports,
accounting compilations, lists and data concerning loan
transactions and other information the director requires to carry
out the purposes of sections 1 to 13 of this 2009 Act.
(6) A person subject to investigation, audit or examination
under this section may not knowingly withhold, abstract, remove,
mutilate, destroy or conceal books, accounts, records, computer
records, files, documents or other information or evidence that
is subject to the director's authority under this section. + }
SECTION 12. { + A person who is subject to regulation under
sections 1 to 13 of this 2009 Act in connection with the person's
activities as a mortgage loan originator may not:
(1) Perform an act as a mortgage loan originator in a negligent
or incompetent manner;
(2) Employ a device, scheme or artifice to defraud or engage in
an act, practice or course of business that operates or would
operate as a fraud or deceit;
(3) Knowingly make an untrue statement of a material fact or
omit from a statement a material fact that would make the
statement not misleading in light of the circumstances under
which the person makes the statement;
(4) Make or file or cause to be made or filed with the Director
of the Department of Consumer and Business Services a statement,
report or document that the person knows is false in a material
respect or matter;
(5) Engage in an unfair or deceptive practice toward another
person;
(6) Obtain property by fraud or misrepresentation;
(7) Solicit or enter into a contract with a borrower, the terms
of which provide that the person may earn a fee or commission for
using the person's best efforts to obtain a residential mortgage
loan even if the person does not obtain a residential mortgage
loan for the borrower, except that the terms of the contract may
provide that the person may earn an advance fee or recover actual
expenses that the person incurs;
(8) Solicit, advertise or enter into a contract, the terms of
which specify an interest rate, points or other financing terms
unless the interest rate, points or other financing terms are
available to a prospective borrower at the time the person makes
the solicitation or advertisement or enters into the contract;
(9) Conduct or operate a business that requires a mortgage loan
originator's license without holding a license issued under
section 4 or 6 of this 2009 Act or assist or enable another
person who does not have a mortgage loan originator's license to
conduct or operate a business that requires a mortgage loan
originator's license;
(10) Fail to disclose or provide information required under
sections 1 to 13 of this 2009 Act or by state or federal laws,
rules or regulations;
(11) Fail to comply with a provision of sections 1 to 13 of
this 2009 Act, a rule adopted by the Director of the Department
of Consumer and Business Services or state or federal laws, rules
or regulations that apply to a business that is subject to
regulation under sections 1 to 13 of this 2009 Act;
(12) Fail to conduct business as a mortgage loan originator in
compliance with the provisions of:
(a) The Truth in Lending Act, 15 U.S.C. 1601 et seq. and
Regulation Z, 12 C.F.R. part 226, as in effect on October 1,
2009;
(b) The Real Estate Settlement Procedures Act, 12 U.S.C. 2601
et seq. and Regulation X, 24 C.F.R. part 3500, as in effect on
January 1, 2010;
(c) The Equal Credit Opportunity Act, 15 U.S.C. 1691 et seq.
and Regulation B, 12 C.F.R. 202.9, 202.11, 202.12 and 202.14, as
in effect on the effective date of this 2009 Act; or
(d) 12 U.S.C. 5101 et seq. and regulations adopted under 12
U.S.C. 5101 et seq.;
(13) Make, negligently or intentionally, a false or deceptive
statement or representation in any manner concerning the rates,
points or other financing terms or conditions for a residential
mortgage loan;
(14) Make a false statement negligently in, or omit knowingly
or willfully a material fact from, a report or information the
person submits to a government agency or the Nationwide Mortgage
Licensing System and Registry or in connection with an
investigation or examination conducted by the director or a
government agency;
(15) Make a payment, threat or promise, directly or indirectly,
to another person for the purpose of influencing the other
person's independent judgment concerning a residential mortgage
loan or to an appraiser for the purpose of influencing the
appraiser's independent judgment concerning the value of
property;
(16) Charge or collect, attempt to charge or collect or propose
or enter into an agreement in which the person charges or
collects a fee that is prohibited under sections 1 to 13 of this
2009 Act;
(17) Cause or require a borrower to obtain property insurance
in an amount that exceeds the replacement cost of the property
subject to the residential mortgage loan; or
(18) Fail to account truthfully for moneys that belong to a
party to a residential mortgage loan transaction. + }
SECTION 13. { + (1)(a) A licensed mortgage loan originator
shall clearly display the licensed mortgage loan originator's
unique identifier on a residential mortgage loan application
form, solicitation, advertisement, promotional material or
website the licensed mortgage loan originator uses in connection
with the licensed mortgage loan originator's business.
(b) The Director of the Department of Consumer and Business
Services by rule may specify the location, size or other
characteristics of the unique identifier that must appear on the
materials described in paragraph (a) of this subsection and the
materials on which the unique identifier must appear.
(2) A person that employs a licensed mortgage loan originator
shall submit a report of condition to the Nationwide Mortgage
Licensing System and Registry. The form and contents of the
report and the times at which the licensed mortgage loan
originator submits the report shall comply with the
specifications of the Nationwide Mortgage Licensing System and
Registry.
(3) A loan processor or underwriter may not represent to the
public by means of advertising, business cards, stationery,
brochures, signs, rate lists or other communications, promotional
items or methods that the loan processor or underwriter can, will
or is authorized to perform the duties of a mortgage loan
originator unless the loan processor or underwriter obtains a
mortgage loan originator's license under section 4 of this 2009
Act. + }
SECTION 13a. { + The Director of the Department of Consumer
and Business Services may adopt, amend and repeal rules that are
necessary to carry out the provisions of sections 1 to 13 of this
2009 Act. + }
SECTION 14. ORS 59.840 is amended to read:
59.840. As used in ORS 59.840 to 59.980:
{ - (1) 'Director' means the Director of the Department of
Consumer and Business Services. - }
{ - (2) - } { + (1) + } 'Fraud,' 'deceit' and 'defraud' are
not limited to common-law deceit.
{ - (3) - } { + (2) + } 'License' means a license issued to
a mortgage banker or mortgage broker under ORS 59.840 to 59.980.
{ - (4)(a) 'Loan originator' means an individual employed by
or purporting to act as an agent or independent contractor for a
mortgage banker or mortgage broker that is required to be
licensed under ORS 59.840 to 59.980, with the expectation by the
individual of compensation or gain that is determined by the
amount borrowed or the terms and conditions agreed to by the
mortgage loan borrower, and having primary job responsibilities
that include negotiating with a borrower or potential borrower
for the purpose of establishing the terms and conditions of a
mortgage loan. - }
{ - (b) 'Loan originator' includes a person employed at a
location outside this state whose primary job responsibilities
include contacting or attempting to contact a borrower or
potential borrower within this state through any medium or mode
of communication for purposes of providing a mortgage loan within
this state. - }
{ - (c) 'Loan originator' does not include an individual
whose responsibilities are clerical or administrative functions,
including but not limited to gathering information, requesting
information, word processing, soliciting general interest in
mortgage loans, sending correspondence and assembling files. - }
{ - (d) 'Loan originator' does not include an employee of a
mortgage banker that is rated as good or better under the federal
rating system in effect on May 1, 2001, for seller-servicers of
Federal Housing Administration, Federal Home Loan Mortgage
Corporation or Federal National Mortgage Association loans and
that has an office within this state at which the mortgage banker
maintains complete and current copies of all employment records
and other records as required by the Director of the Department
of Consumer and Business Services by order or rule, in a format
acceptable to the director. - }
{ - (e) 'Loan originator' does not include an insurance
producer licensed under ORS 744.052 to 744.089 or insurance
consultant licensed under ORS 744.002. - }
{ - (f) 'Loan originator' does not include a person or group
of persons exempted by rule or order of the director. - }
{ - (5) - } { + (3)(a) + } 'Mortgage banker' { - : - }
{ - (a) - } means { - any - } { + a + } person
{ - who - } { + that + } for compensation or in the
expectation of compensation:
(A) Either directly or indirectly makes, negotiates or offers
to make or negotiate a mortgage banking loan or a mortgage loan;
and
(B) Services or sells a mortgage banking loan.
(b) { + ' Mortgage banker' + }does not include:
(A) A financial institution, as defined in ORS 706.008.
(B) A financial holding company or a bank holding company, as
defined in ORS 706.008, holding an institution described in
subparagraph (A) of this paragraph; a savings and loan holding
company as defined in { - section 408 of the National Housing
Act, 12 U.S.C. 1730a (1982) - } { + 12 U.S.C.
1467a(a)(1)(D) + }, holding an association described in
subparagraph (A) of this paragraph; the subsidiaries and
affiliates of the financial holding company, bank holding company
or savings and loan holding company; or subsidiaries and
affiliates of institutions described in subparagraph (A) of this
paragraph, provided that the appropriate statutory regulatory
authority is exercising control over or is regulating or
supervising the persons listed in this subparagraph in their
mortgage banking activities in accordance with the purposes of
ORS 59.840 to 59.980.
(C) A person { - who - } { + that + } makes a loan secured
by an interest in real estate with the person's own moneys
{ - , - } for the person's own investment and { - who - }
{ + that + } is not engaged in the business of making loans
secured by an interest in real estate.
(D) { - An attorney licensed in this state who negotiates
mortgage banking loans or mortgage loans in the ordinary course
of business, unless the business of negotiating mortgage banking
loans or mortgage loans constitutes substantially all of the
attorney's professional activity. - } { + An attorney licensed
or otherwise authorized to practice law in this state if the
attorney:
(i) Negotiates the terms of a residential mortgage loan as an
ancillary matter in the attorney's representation of a client;
and
(ii) Does not receive compensation from a mortgage banker,
mortgage broker, mortgage loan originator or lender or an agent
of the mortgage banker, mortgage broker, mortgage loan originator
or lender. + }
(E) A person { - who - } { + that + }, as seller of real
property, receives one or more mortgages or deeds of trust as
security for a separate money obligation.
(F) An agency of { - any - } { + a + } state or of the
United States.
(G) A person { - who - } { + that + } receives a mortgage
or deed of trust on real property as security for an obligation
payable on an installment or deferred payment basis and arising
out of materials furnished or services rendered in the
improvement of { - that - } { + the + } real property or
{ - any - } { + a + } lien created without the consent of the
owner of the real property.
(H) A person { - who - } { + that + } funds a mortgage
banking loan or mortgage loan { - which has been originated and
processed by a licensee or by an exempt person and who - } { +
that a licensee or exempt person originated and processed and
that + } does not maintain a place of business in this state in
connection with funding mortgage banking loans or mortgage loans,
does not directly or indirectly solicit borrowers in this state
for the purpose of making mortgage banking loans or mortgage
loans and does not participate in { - the negotiation of - }
{ + negotiating + } mortgage banking loans or mortgage loans.
For the purpose of this subparagraph, ' { - negotiation of - }
{ + negotiating + } mortgage banking loans or mortgage loans'
does not include setting the terms under which a person may buy
or fund a mortgage banking loan or a mortgage loan
{ - originated by - } { + that + } a licensee or exempt
person { + originated + }.
(I) A nonprofit federally tax exempt corporation certified by
the United States Small Business Administration and organized to
promote economic development within this state whose primary
activity consists of providing financing for business expansion.
(J) A licensee licensed under ORS chapter 725 or a mortgage
broker.
(K) A retirement or pension fund.
(L) An insurer as defined in ORS 731.106.
(M) A court appointed fiduciary.
(N) { - Any other - } { + A + } person designated by rule
or order of the Director { + of the Department of Consumer and
Business Services + }.
{ - (6) - } { + (4) + } 'Mortgage banking loan' means a
loan, extension of credit or a retail sales contract that is
funded exclusively from the mortgage banker's own resources,
{ - which - } { + that + } is directly or indirectly secured
by a mortgage or deed of trust or any lien interest on real
estate and { - which - } { + that + } is created with the
consent of the owner of the real property. For purposes of this
subsection, 'own resources' means any of the following:
(a) Cash, corporate capital, warehouse credit lines at
financial institutions defined in ORS 706.008 or other sources
that are liability items of the mortgage banker's financial
statements for which { - its - } { + the mortgage
banker's + } assets are pledged;
(b) Correspondent contracts between the mortgage banker and a
bank, savings bank, trust company, savings and loan association,
credit union, profit sharing or pension trust, a licensee under
ORS chapter 725 or an insurance company; or
(c) The mortgage banker's affiliates' cash, corporate capital,
warehouse credit lines at financial institutions defined in ORS
706.008 or other sources that are liability items on the
affiliates' financial statements for which the affiliates' assets
are pledged. As used in this paragraph, 'affiliates' means
entities that, directly or indirectly, through one or more
intermediaries { - controls - } { + control + }, are
controlled by or are under common control with the entity
specified.
{ - (7) - } { + (5)(a) + } 'Mortgage broker' { - : - }
{ - (a) - } means a person { - who - } { + that + }:
(A) Engages all or part of the time, for the account of others
or for the person's own account, in the business of selling real
estate paper whether as issuer, agent or principal to persons
other than persons enumerated in ORS 59.035 (4);
(B) Engages all or part of the time, for the account of others
or for the person's own account, in the business of accepting
funds from one or more persons other than persons enumerated in
ORS 59.035 (4) for investment in real estate paper; or
(C) For compensation, or in the expectation of compensation,
either directly or indirectly makes, negotiates or offers to make
or negotiate a mortgage loan.
(b) { + ' Mortgage broker' + } does not include:
(A) A financial institution, as defined in ORS 706.008.
(B) { + (i) + } A financial holding company or a bank holding
company, as defined in ORS 706.008, holding an institution
described in subparagraph (A) of this paragraph;
{ + (ii) + } A savings and loan holding company as defined in
{ - section 408 of the National Housing Act, 12 U.S.C. 1730a
(1982) - } { + 12 U.S.C. 1467a(a)(1)(D) + }, holding an
association described in subparagraph (A) of this paragraph;
{ + (iii) + } The subsidiaries and affiliates of the
financial holding company, bank holding company or savings and
loan holding company; or
{ + (iv) + } Subsidiaries and affiliates of institutions
described in subparagraph (A) of this paragraph, provided that
the appropriate statutory regulatory authority is exercising
control over or is regulating or supervising the persons listed
in this subparagraph in { - their - } { + the persons' + }
mortgage brokering activities in accordance with the purposes of
ORS 59.840 to 59.980.
(C) A person { - who - } { + that + } purchases real
property and issues an obligation to finance the transaction to
the seller incidentally to the sale.
(D) A real estate licensee as defined in ORS 696.010 who
performs services solely incidental to the practice of
professional real estate activity as defined in ORS 696.010,
unless the real estate licensee performs the functions of a
mortgage banker or a mortgage broker as defined in this section.
(E) A person licensed under the provisions of ORS chapter 725
or a mortgage banker.
(F) A person { - who - } { + that + } makes a loan secured
by an interest in real estate with the person's own moneys, for
the person's own investment and { - who - } { + that + } is
not engaged in the business of making loans secured by an
interest in real estate.
(G) { - An attorney licensed in this state who negotiates
mortgage loans in the ordinary course of business, unless the
business of negotiating mortgage loans constitutes substantially
all of the attorney's professional activity. - } { + An
attorney licensed or otherwise authorized to practice law in this
state if the attorney:
(i) Negotiates the terms of a residential mortgage loan as an
ancillary matter in the attorney's representation of a client;
and
(ii) Does not receive compensation from a mortgage banker,
mortgage broker, mortgage loan originator or lender or an agent
of the mortgage banker, mortgage broker, mortgage loan originator
or lender. + }
(H) A person { - who - } { + that + }, as { + a + } seller
of real property, receives one or more mortgages or deeds of
trust as security for a separate money obligation.
(I) An agency of { - any - } { + a + } state or of the
United States.
(J) A person { - who - } { + that + } receives a mortgage
or deed of trust on real property as security for an obligation
payable on an installment or deferred payment basis and arising
out of materials furnished or services rendered in the
improvement of { - that - } { + the + } real property or
{ - any - } { + a + } lien created without the consent of the
owner of the real property.
(K) A person { - who - } { + that + } funds a mortgage loan
{ - which has been originated and processed by a licensee or by
an exempt person and who - } { + that a licensee or exempt
person originated and processed and that + } does not maintain a
place of business in this state in connection with funding
mortgage loans, does not directly or indirectly solicit borrowers
in this state for the purpose of making mortgage loans and does
not participate in { - the negotiation of - } { +
negotiating + } mortgage loans. For the purpose of this
subparagraph, ' { - negotiation of - } { + negotiating + }
mortgage loans' does not include setting the terms under which a
person may buy or fund a mortgage loan { - originated by - }
{ + that + } a licensee or exempt person { + originated + }.
(L) A nonprofit federally tax exempt corporation certified by
the United States Small Business Administration and organized to
promote economic development within this state whose primary
activity consists of providing financing for business expansion.
(M) A person licensed under ORS 446.691 or 446.696 or a
temporary manufactured structure dealer licensee under ORS
446.701
{ - who - } { + that + } provides services customarily
associated with the retail sales of manufactured dwellings,
including communication of generally available information
regarding mortgage loans, unless:
(i) The person receives from a purchaser a fee or commission as
a mortgage broker or mortgage banker that is disclosed in the
sales contract, purchase agreement or applicable federal
documents;
(ii) For the benefit of a potential purchaser, the person
completes a loan application form or other document that is part
of a mortgage banking loan and completes a good faith estimate
under the federal Real Estate Settlement Procedures Act
{ - ( - } 12 U.S.C. 2601 et seq. { - ) - } ;
(iii) The person solicits or receives credit information from a
prospective purchaser for the purpose of making credit decisions;
or
(iv) The person negotiates with a potential purchaser the terms
of a mortgage loan including but not limited to points, interest
rates, length of loan or other loan conditions.
(N) { - Any other - } { + A + } person designated by rule
or order of the director.
{ - (8) - } { + (6) + } 'Mortgage loan' means a loan,
extension of credit or retail sales contract, other than a
mortgage banking loan, secured by a mortgage or deed of trust or
{ - any - } { + a + } lien interest on real estate that is
created with the consent of the owner of the real estate.
{ + (7) 'Mortgage loan originator' has the meaning given that
term in section 1 of this 2009 Act. + }
{ - (9) - } { + (8) + } 'Residential mortgage transaction'
means a transaction in which a mortgage, deed of trust, purchase
money security interest arising under an installment sales
contract, or equivalent consensual security interest is created
or retained in property upon which four or fewer residential
dwelling units are planned or situated, including but not limited
to individual units or condominiums and cooperatives. As used in
this subsection, ' residential dwelling unit' means an
improvement designed for residential occupancy.
SECTION 15. ORS 59.850 is amended to read:
59.850. (1) The Director of the Department of Consumer and
Business Services by rule shall establish procedures for
licensing mortgage bankers or mortgage brokers. The director may
coordinate licensing with { - any national registration or
licensing system - } { + the Nationwide Mortgage Licensing
System and Registry + }.
(2) An applicant for a license { - as a mortgage banker or
mortgage broker - } , or a managing partner, director, executive
officer or other individual { - occupying - } { + that
occupies + } a similar position or { - performing - } { +
performs + } similar functions for the applicant, shall have,
during the five years immediately preceding the time of
application, not less than three years' experience in the
mortgage business, three years' experience negotiating loans in a
related business satisfactory to the director or three years'
equivalent lending experience in a related business satisfactory
to the director.
(3) If a license { - as a mortgage banker or mortgage
broker - } is issued to a person other than an individual, at
least one managing partner, director, executive officer or other
individual
{ - occupying - } { + that occupies + } a similar position or
{ - performing - } { + performs + } similar functions for the
person shall, at all times during the term of the license,
satisfy the experience requirement described in subsection (2) of
this section.
(4) { - Every - } { + An + } applicant for a license { +
that is not subject to the requirement set forth in section 9 of
this 2009 Act + } { - as a mortgage banker or mortgage
broker - } shall file with the director a corporate surety bond
or irrevocable letter of credit { + that is approved by the
director in an amount the director specifies by rule, that runs
to the State of Oregon and that is + } issued by an insured
institution as defined in ORS 706.008 { - as the director may
approve by rule running to the State of Oregon in a sum to be
determined by the director by rule - } .
(5) The total amount of the corporate surety bond or
irrevocable letter of credit for a single applicant under
subsection (4) of this section shall be not less than { +
$50,000. + }
{ - $25,000 but not more than $50,000, regardless of the number
of offices of the applicant. If an applicant has more than one
office in this state to engage in residential mortgage
transactions as a mortgage banker or mortgage broker, the amount
of the bond or letter of credit shall increase for each
additional office in an amount determined by the director by
rule. The amount of the increase in the bond or letter of credit
for each additional office shall be not less than $5,000 but not
more than $10,000. The director may adjust the minimum amount of
the increase in the bond or letter of credit for additional
offices as necessary to comply with the $50,000 limit. - } { +
The director by rule shall require the sum of the corporate
surety bond or irrevocable letter of credit to reflect the dollar
amount of the loans that the mortgage banker or mortgage broker
originates. + }
(6) If the application, surety bond or irrevocable letter of
credit and fees are in order and the director is satisfied that
the application should not be denied upon one or more of the
grounds specified in ORS 59.865, 59.870 or 59.875, the director
shall license the mortgage banker or mortgage broker.
(7) A licensee shall amend the license application and, if
necessary, increase the amount of the corporate surety bond or
irrevocable letter of credit { - as - } described in
subsection (5) of this section when there are material changes in
the information contained in the original application.
{ + (8) An applicant for a license under this section or a
licensee who applies to renew a license under ORS 59.855 shall
certify to the director in a form and manner the director
specifies by rule that the applicant or licensee has
independently verified that every individual the applicant or
licensee hired or intends to hire as a mortgage loan originator:
(a) Meets the requirements set forth in sections 1 to 13 of
this 2009 Act;
(b) Has undergone a state criminal records check in accordance
with ORS 59.972; and
(c) Is covered, if applicable, by a corporate surety bond as
provided in section 9 of this 2009 Act. + }
{ - (8) - } { + (9) + } The director shall:
(a) Charge and collect fees for initial and renewal license
applications { - ; - } { + . + }
(b) Set by rule all fees required under this section. { + The
director shall set the + }fees { - shall be set - } to
reflect { - those - } amounts sufficient to meet the costs of
administering ORS 59.840 to 59.980, including { - those - }
amounts sufficient to establish and maintain a reasonable
emergency fund { - ; and - } { + . + }
(c) Set by rule the amounts of corporate surety bonds and
irrevocable letters of credit required under this section.
{ - (9) - } { + (10) + } The fees under this section are
not refundable except for { - those - } fees that the director
determines by rule { - may be - } { + are + } refundable.
SECTION 16. ORS 59.855 is amended to read:
59.855. (1) { - The initial - } { + An initial + } license
{ - of a mortgage banker or mortgage broker - } expires one
year after the date of issuance unless the Director of the
Department of Consumer and Business Services establishes a
different expiration date { - for purposes of coordination with
any national registration or licensing system - } { + to
coordinate with the Nationwide Mortgage Licensing System and
Registry + }.
(2) The director by rule shall establish procedures { - for
renewing licenses of mortgage bankers and mortgage brokers - }
{ + to renew a license + }. The rule shall specify the duration
of { + a + } renewed
{ - licenses - } { + license + }.
(3) If there is a change in the partners, directors, officers
{ - , - } { + or + } persons { - occupying - } { + that
occupy + } similar positions or { - performing - } { +
perform + } similar functions, or persons { + that + } directly
or indirectly { - controlling - } { + control + } a mortgage
banker or mortgage broker, written notification of the change
{ - shall promptly - } { + must + } be filed { + promptly + }
with the director. No fee { - shall be - } { + is + }
required for the notification.
SECTION 17. ORS 59.860, as amended by section 1, chapter 38,
Oregon Laws 2008, is amended to read:
59.860. (1) { - Every - } { + A + } mortgage banker
{ - and - } { + or + } mortgage broker shall make and keep
{ - such - } accounts, correspondence, memoranda, papers, books
and other records { - as - } { + that + } the Director of the
Department of Consumer and Business Services by rule or order
prescribes. { - All such records shall be preserved - } { +
The mortgage banker or mortgage broker shall preserve the
records + } for five years unless the director by rule prescribes
otherwise. The director may examine { - all such - } { +
the + } records within or { - without - } { + outside + }
this state at any reasonable time or times and may require
without subpoena the production of { - such - } { + the + }
records at the office of the director as often as is reasonably
necessary.
(2) { - Every - } { + A + } mortgage banker { - and - }
{ + or + } mortgage broker shall file financial reports or
other information { - as - } { + that + } the director by
rule or order { - may require - } { + requires + } and shall
promptly correct
{ - any - } { + a + } document filed with the director that
is or becomes incomplete or inaccurate in any material respect.
(3) On or before May 1 of each year or on a date the director
establishes by rule, { - every - } { + a + } mortgage banker
{ - and - } { + or + } mortgage broker shall file a report
with the director in a form prescribed by the director. The
report shall contain information the director requires concerning
the mortgage banker's or mortgage broker's business and
operations related to residential mortgage lending during the
preceding calendar year. The information shall include the number
and nature of loans originated by { + mortgage + } loan
originators that the mortgage banker or mortgage broker employed.
(4) The report and any records submitted to the director under
this section are exempt from disclosure or production and are
confidential as provided under ORS 705.137.
(5) Notwithstanding the exemption and confidentiality
provisions of subsection (4) of this section, the director may
abstract information contained in reports submitted under
subsection (3) of this section and may make the abstracted
information available for public inspection provided that the
abstracted information does not identify a particular mortgage
banker or mortgage broker as a source of the information.
SECTION 18. ORS 59.865 is amended to read:
59.865. Except as provided in ORS 59.870, the Director of the
Department of Consumer and Business Services may by order deny,
suspend, condition or revoke a license { - of a person as a
mortgage banker or mortgage broker - } if the director finds
that the applicant or licensee:
(1) Is insolvent, either in the sense that the liabilities of
the applicant or licensee exceed the assets of the applicant or
licensee or that the applicant or licensee cannot meet the
obligations of the applicant or licensee as the obligations
mature, or { + that the applicant or licensee + } is in such
financial condition that the applicant or licensee cannot
continue in business with safety to the customers of the
applicant or licensee.
(2) { - Has - } Engaged in dishonest, fraudulent or illegal
practices or conduct in any business or profession or unfair or
unethical practices or conduct in connection with the mortgage
business.
(3) { - Has - } Willfully or repeatedly violated or failed
to comply with { - any - } { + a + } provision of ORS 59.840
to 59.980 or { - any - } { + a + } rule or order of the
director.
{ + (4) Failed, in conducting business as a mortgage banker
or mortgage broker, to comply with the provisions of:
(a) The Truth in Lending Act, 15 U.S.C. 1601 et seq. and
Regulation Z, 12 C.F.R. part 226, as in effect on October 1,
2009;
(b) The Real Estate Settlement Procedures Act, 12 U.S.C. 2601
et seq. and Regulation X, 24 C.F.R. part 3500, as in effect on
January 1, 2010;
(c) The Equal Credit Opportunity Act, 15 U.S.C. 1691 et seq.
and Regulation B, 12 C.F.R. 202.9, 202.11, 202.12 and 202.14, as
in effect on the effective date of this 2009 Act; or
(d) 12 U.S.C. 5101 et seq. and regulations adopted under 12
U.S.C. 5101 et seq. + }
{ - (4) - } { + (5) + } { - Has been - } { + Was + }
convicted of a misdemeanor, an essential element of which is
fraud, or of a felony.
{ - (5) - } { + (6) + } { - Has - } Filed an application
for a license that, as of the date the license was issued, or as
of the date of an order
{ - denying, suspending, conditioning or revoking - } { +
that denied, suspended, conditioned or revoked + } a license, was
incomplete in any material respect or contained { - any - }
{ + a + } statement that was, in light of the circumstances
under which { - it - } { + the statement + } was made, false
or misleading with respect to { - any - } { + a + } material
fact.
{ - (6) - } { + (7) + } { - Has - } Failed to account to
persons interested for
{ - all - } money or property received in connection with a
mortgage loan.
{ - (7) - } { + (8) + } Is permanently or temporarily
enjoined by a court of competent jurisdiction from engaging in or
continuing { - any - } conduct or { + a + } practice
{ - involving any - } { + that involves an + } aspect of the
mortgage business.
{ - (8) - } { + (9) + } Is { - the - } subject
{ - of - } { + to + } an order of the director
{ - denying, suspending, conditioning or revoking - } { +
that denies, suspends, conditions or revokes + } a license
{ - as a mortgage banker or mortgage broker - } .
{ - (9) - } { + (10) + } Is { - the - } subject
{ - of - } { + to + } a United States Postal Service fraud
order that is currently effective and was issued within the last
five years.
{ - (10) - } { + (11) + } Does not have the experience
required by ORS 59.850 (2) or (3).
{ - (11) - } { + (12) + } { - Has - } Failed to comply
with the requirements of ORS 59.860 to make and keep records
prescribed by rule or order of the director, to produce such
records required by the director or to file any financial reports
or other information the director by rule or order may require.
{ - (12) Is the subject of an order of the director denying,
suspending, conditioning or revoking a license under the
provisions of any other law administered by the director. - }
{ - (13) Is the subject of a cease and desist order entered
after notice and opportunity for hearing and issued by the
director within the last five years. - }
{ + (13) Is subject to an order of the director that denies,
suspends, conditions or revokes a license under any other law the
director administers.
(14) Is subject to a cease and desist order the director
entered within the previous five years after the applicant or
licensee had notice and an opportunity for a hearing. + }
{ - (14) - } { + (15) + } { - Has - } Demonstrated
negligence or incompetence in performing any act for which the
licensee is required to hold a license.
{ - (15) - } { + (16) + } { - Has - } Failed to
supervise diligently and control the mortgage-related activities
of a { + mortgage + } loan originator
{ - employed by - } the licensee { + employs + }.
{ - (16) - } { + (17) + } { - Has - } Knowingly
misrepresented to the director the training of, examination of or
continuing education time earned by a { + mortgage + } loan
originator { - employed by - } the licensee { + employs + }.
{ - (17) - } { + (18) + } { - Has - } Willfully or
repeatedly employed { - persons - } { + individuals + } as
{ + mortgage + } loan originators who do not meet the training,
education or continuing education requirements for { +
mortgage + } loan originators.
{ - (18) - } { + (19) + } { - Has - } Failed to notify
the director of the termination of a { + mortgage + } loan
originator for failure to comply with state or federal laws,
regulations or rules.
SECTION 19. ORS 59.875 is amended to read:
59.875. { - (1) If the Director of the Department of Consumer
and Business Services finds that an applicant or licensee has
ceased to do business as a mortgage banker or mortgage broker, or
has failed to maintain a bond required by ORS 59.850 or is
subject to an adjudication of mental incompetence or to the
control of a committee, conservator or guardian, or cannot be
located after reasonable search, the director may cancel the
license or application. - }
{ + (1) The Director of the Department of Consumer and
Business Services may cancel an application or license if the
director finds that the applicant or licensee:
(a) Has ceased to do business as a mortgage banker or mortgage
broker;
(b) Has failed to maintain a corporate surety bond or
irrevocable letter of credit required under ORS 59.850 or section
9 of this 2009 Act; or
(c) Cannot be located after a reasonable search. + }
(2) A mortgage banker or mortgage broker may { - withdraw - }
{ + surrender + } a license by filing an application to
{ - withdraw - } { + surrender the license + }. Unless the
director determines that the license should be suspended or
revoked, the director shall allow the { - withdrawal - } { +
surrender + } subject to any conditions, limitations and
restrictions the director may impose.
SECTION 20. ORS 59.880 is amended to read:
59.880. The Director of the Department of Consumer and Business
Services { - shall have - } { + has + } general supervision
and control over { - all - } { + mortgage + } loan
originators, mortgage bankers and mortgage brokers residing or
doing business in this state and engaged in { - any - } { +
an + } activity { + that is + } subject to the provisions of ORS
59.840 to 59.980. { - All such persons and their records and
everything connected with their activities shall be - } { +
Mortgage bankers and mortgage brokers and the records and
activities connected with mortgage bankers, mortgage brokers and
mortgage loan originators are + } subject to examination by the
director at any time. The provisions of this section and of any
other section of ORS 59.840 to 59.980 relating to examinations
{ - shall - } extend to
{ - any - } { + a + } person { - who - } { + that is
or + } should have been { - reported - } { + licensed + } as
a { + mortgage + } loan originator under { - ORS 59.969 - }
{ + sections 1 to 13 of this 2009 Act + } or licensed as a
mortgage banker or mortgage broker, { - any - } { + a + }
person exempted by rule from { - those - } { + the + }
definitions { + of mortgage banker, mortgage broker or mortgage
loan originator + } or { - any - } { + a + } person whose
license has expired or has been withdrawn, canceled, suspended,
conditioned or revoked. The director may collect from { - each
such - } { + the + } person the actual expenses incurred in
{ - that - } { + the + } examination.
SECTION 21. ORS 59.900 is amended to read:
59.900. (1) In accordance with this section and ORS chapter
183, the Director of the Department of Consumer and Business
Services may from time to time make, amend and rescind such rules
as are necessary to carry out the provisions of ORS 59.840 to
59.980, including but not limited to rules governing the
activities of { + mortgage + } loan originators, mortgage
bankers and mortgage brokers and rules governing the purchase or
sale of mortgage banking loans, mortgage loans or real estate
paper in coordination with applicable provisions of ORS 59.005 to
59.451, 59.710 to 59.830, 59.991 and 59.995 and rules adopted
{ - thereunder - } { + under the applicable provisions + }.
(2) { - Any - } { + A + } financial statement required
under ORS 59.840 to 59.980 { - shall - } { + must + } be
prepared in accordance with generally accepted accounting
principles. The director may by rule prescribe:
(a) The form and content of financial statements required under
ORS 59.840 to 59.980;
(b) The circumstances under which consolidated financial
statements { - shall - } { + must + } be filed; and
(c) Whether any required financial statements { - shall - }
{ + must + } be certified by independent or certified public
accountants.
SECTION 22. ORS 59.905 is amended to read:
59.905. (1) Except as provided in ORS 183.745, upon the entry
of an order under ORS 59.840 to 59.980, the Director of the
Department of Consumer and Business Services shall promptly give
appropriate notice of the order as provided in this subsection.
The notice shall state that a hearing will be held on the order
if a written demand for hearing is filed with the director within
20 days after the date of service of the order. The notice shall
be given to:
(a) The applicant or licensee { + , + } with respect to orders
entered pursuant to ORS 59.865; { + or + }
{ - (b) The loan originator and the licensee employing the
loan originator with respect to orders entered pursuant to ORS
59.973; or - }
{ - (c) - } { + (b) + } { - All - } { + An + }
interested { - persons - } { + person, + } with respect to
orders entered pursuant to any other provision of ORS 59.840 to
59.980.
(2) If { - timely demand for a hearing is filed by - } a
person entitled to notice of the order { + files a timely demand
for a hearing + }, the director shall hold a hearing on the order
as provided by ORS chapter 183. In the absence of a timely demand
for a hearing, a person is not entitled to judicial review of the
order.
(3) After the hearing, the director shall enter a final order
vacating, modifying or affirming the order.
(4) The director may enter a final order revoking a license
notwithstanding the fact that the license has expired, if the
initial order of revocation was issued { - prior to expiration
of - } { + before + } the license or registration { +
expired + }.
SECTION 23. ORS 59.925 is amended to read:
59.925. { - (1) As used in this section, 'mortgage banker
transaction' and 'mortgage broker transaction' mean a transaction
in which a person, in order to engage in the transaction, is
required to be licensed as a mortgage banker or a mortgage broker
under ORS 59.840 to 59.980. - }
{ - (2) - } { + (1) + } A { - mortgage banker or mortgage
broker - } { + person that employs a mortgage loan originator
or under the provisions of sections 1 to 13 of this 2009 Act
should employ a mortgage loan originator + } is liable as
provided in subsection { - (3) - } { + (2) + } of this
section { - to any person who suffers any - } { + for an + }
ascertainable loss of money or property, real or personal, in a
{ - mortgage banker transaction or a mortgage broker - } { +
residential mortgage + } transaction if the { - mortgage banker
or mortgage broker - } { + person engages in a residential
mortgage transaction in which the person + }:
(a) { - Transacts business as a mortgage banker or mortgage
broker in violation of any - } { + Violates a + } provision of
{ + sections 1 to 13 of this 2009 Act, except section 12 (11) of
this 2009 Act, or + } ORS 59.840 to 59.980 { + , except ORS
59.865 (4) + }; or
(b) { + (A)(i) + } { - Transacts business as a mortgage
banker or mortgage broker by means of - } { + Makes + } an
untrue statement of a material fact { + ; + } or
{ + (ii) + } { - an omission to state a material fact
necessary in order to make the statements made, in light of the
circumstances under which they are made, not misleading, and who
does not sustain the burden of proof that the person did not
know, and in the exercise of reasonable care could not have
known, of the untruth or omission. - } { + Omits from a
statement a material fact that would make the statement not
misleading in light of the circumstances under which the person
makes the statement; and
(B) Fails to prove that the person did not know, or in the
exercise of reasonable care could not have known, of the untrue
statement or omission. + }
{ - (3) - } { + (2) + } The person suffering ascertainable
loss may recover damages in an amount equal to the ascertainable
loss.
{ - (4) - } { + (3) + } A person whose sole function in
connection with a { + residential mortgage + }transaction is
to provide ministerial functions of escrow, custody or deposit
services in accordance with applicable law is liable only if the
person participates or materially aids in the { + residential
mortgage + } transaction and the plaintiff sustains the burden of
proof that the person knew of the existence of the facts on which
liability is based or that the person's failure to know of the
existence of { - such - } { + the + } facts was the result of
the person's recklessness or gross negligence.
{ - (5) - } { + (4) + } Except as otherwise provided in
this subsection, an action or suit may not be commenced under
this section more than three years after the { + residential
mortgage + } transaction. An action under this section for a
violation under subsection (2)(b) of this section or ORS 59.930
may be commenced within three years after the { + residential
mortgage + } transaction or two years after the person bringing
the action discovered or should have discovered the facts on
which the action is based, whichever is later, but { - in no
event more - } { + not later + } than five years after the date
of the { + residential mortgage + }transaction. Failure to
commence an action on a timely basis is an affirmative defense.
{ - (6) - } { + (5) + } A person has a right of action
under the { + corporate surety + } bond or irrevocable letter of
credit { - provided in - } { + required under + } ORS
59.850 { + or section 9 of this 2009 Act + } if the person:
(a) { - Signs - } { + Initiates + } a mortgage banking loan
or mortgage loan application; and
(b) Has a right of action against { - a mortgage banker or
mortgage broker - } { + another person + } under this section.
{ - (7) - } { + (6) + } Subsection { - (4) - } { +
(3) + } of this section does not limit { + a person's + }
{ - the - } liability { - of any person - } :
(a) For conduct other than in the circumstances described in
subsection { - (4) - } { + (3) + } of this section; or
(b) Under any other law.
{ - (8) - } { + (7) + } Except as provided in subsection
{ - (9) - } { + (8) + } of this section, the court may award
reasonable attorney fees to the prevailing party in an action
under this section.
{ - (9) - } { + (8) + } The court may not award attorney
fees to a prevailing defendant under the provisions of subsection
{ - (8) - } { + (7) + } of this section if the action under
this section is maintained as a class action pursuant to ORCP 32.
SECTION 24. ORS 59.962 is amended to read:
59.962. (1) With the permission of the lender, note owner, note
holder or other holder of an interest in a note, a mortgage
banker or mortgage broker may service or collect { - any - }
{ + a + } mortgage banking loan or mortgage loan in { - its
own name - } { + the name of the mortgage banker or mortgage
broker + } or { + in + } the name of the lender, note owner,
note holder or other holder of an interest in the note.
(2) Except as provided in ORS 59.840 to 59.980, nothing in
subsection (1) of this section { - is intended to grant - }
{ + grants + } the Director of the Department of Consumer and
Business Services the authority to regulate the servicing or
collection of { - any - } { + a + } mortgage banking loan or
mortgage loan by a mortgage banker or mortgage broker.
(3) As used in this section:
(a) 'Mortgage banker' has the meaning given that term in ORS
59.840 { - (5)(a) - } { + (3)(a) + } but also includes
{ - those persons - } { + a person + } exempted from the
definition of mortgage banker in ORS 59.840 { - (5)(b) - }
{ + (3)(b) + }.
(b) 'Mortgage banking loan' has the meaning given that term in
ORS 59.840.
(c) 'Mortgage broker' has the meaning given that term in ORS
59.840.
(d) 'Mortgage loan' has the meaning given that term in ORS
59.840.
(e) 'Service or collect any mortgage banking loan or mortgage
loan' includes but is not limited to:
(A) Holding documents or written instruments and receiving and
disbursing payments according to the instructions of the parties
to the documents or written instruments;
(B) Collecting or remitting, or having the right or obligation
to collect or remit, for { - any - } { + a + } lender, note
owner, note holder or other holder of an interest in a note or
for a mortgage banker's or mortgage broker's own account,
payments, interest, principal and trust items, including but not
limited to hazard insurance and taxes, on a mortgage banking loan
or mortgage loan in accordance with the terms of the loan, and
includes loan payment follow-up, delinquency loan follow-up, loan
analysis and
{ - any - } notifications to the borrower that are necessary
to enable the borrower to keep the loan current and in good
standing; and
(C) Bringing and maintaining { - any - } { + a + } suit or
action to collect { - any - } amounts owed on a mortgage
banking loan or mortgage loan, including but not limited to
{ - the exercise of any - } { + exercising + } contractual,
statutory or common law remedies such as injunction, specific
performance, judicial or nonjudicial foreclosure or receivership.
SECTION 25. ORS 59.967 is amended to read:
59.967. (1) The Legislative Assembly finds and declares that:
(a) The public interest is served by identifying a
{ + mortgage + } loan originator with a specific mortgage banker
or mortgage broker; and
(b) The public must be protected from the conflicts of interest
created when a { + mortgage + } loan originator is employed by
more than one mortgage lender.
(2) A { + mortgage + } loan originator may not originate loans
for more than one mortgage banker, mortgage broker or other
mortgage lender or independent mortgage agency at the same time.
SECTION 26. ORS 59.971, as amended by section 3, chapter 38,
Oregon Laws 2008, is amended to read:
59.971. (1) A { - person employed by a - } mortgage
banker { + , + } { - or - } mortgage broker { - as a - }
{ + or mortgage + } loan originator may not:
(a) Engage in dishonest, fraudulent or illegal practices or
conduct in { - any - } { + a + } business or profession or
engage in unfair or unethical practices or conduct in connection
with the mortgage business.
(b) Willfully or repeatedly violate or fail to comply with a
provision of ORS 59.840 to 59.980 { + , sections 1 to 13 of this
2009 Act + } or a rule or order of the Director of the Department
of Consumer and Business Services.
(c) Fail to account to persons interested for { - all - }
money or property received in connection with a mortgage loan.
(d) Fail to meet the training, education or continuing
education requirements for { + mortgage + } loan
originators { + set forth in sections 5 or 7 of this 2009
Act + }.
(e) Perform an act as a { + mortgage + } loan originator in a
negligent or incompetent manner.
(2) { - A person - } { + An individual + } may not be
employed by a mortgage banker or mortgage broker as a { +
mortgage + } loan originator
{ - as defined in ORS 59.840 or 59.970 - } if:
(a) The { - person has been - } { + individual was + }
convicted of { - any - } { + a + } crime or category of crime
specified by the director by rule;
(b) The { - person - } { + individual + } is suspended or
has been prohibited from employment as a { + mortgage + } loan
originator under
{ - ORS 59.973 (5)(c) - } { + section 8 of this 2009 Act + };
(c) The employment violates any conditions imposed under
{ - ORS 59.973 (5)(c) - } { + section 8 of this 2009 Act + };
or
(d) The employment violates an order issued by the director, a
state or federal agency or a court of competent jurisdiction.
SECTION 27. ORS 59.972 is amended to read:
59.972. (1) A { - mortgage banker or mortgage broker - }
{ + person that employs or intends to employ an individual as a
mortgage loan originator + } shall conduct a { + state + }
criminal records check of { - each - } { + the + } individual
{ - who the mortgage banker or mortgage broker employs or
intends to employ as a loan originator - } .
(2) A { - mortgage banker or mortgage broker - } { + person
that employs or intends to employ an individual as a mortgage
loan originator + } shall report to the Director of the
Department of Consumer and Business Services the results of
each { + state + } criminal records check conducted under
subsection (1) of this section.
(3) The director shall adopt rules { + to + }:
(a) { - Necessary for the implementation and administration
of - } { + Implement and administer state + } criminal records
checks required under this section { - and ORS 59.970 - } ; and
(b) { - Specifying - } { + Specify crimes and categories of
crimes for which a conviction + } { - categories of criminal
convictions that - } will prevent a person from acting as a { +
mortgage + } loan originator under ORS 59.971.
SECTION 28. ORS 59.992 is amended to read:
59.992. (1) Violation of { - any - } { + a + } provision of
ORS 59.840 to 59.980 or { - any - } { + a + } rule adopted by
the Director of the Department of Consumer and Business Services
under ORS 59.840 to 59.980, except ORS 59.915 (2) { - and
59.975 - } , is a Class C felony.
(2) Violation of ORS 59.915 (2) is a Class A misdemeanor.
SECTION 29. ORS 446.691 is amended to read:
446.691. The { + Director of the + } Department of Consumer
and Business Services shall issue a manufactured structure dealer
license to { - a person - } { + an applicant + } if the
{ - person - } { + applicant + }:
(1) Delivers to the { - department - } { + director + } a
bond or letter of credit that meets the requirements under ORS
446.726;
{ + (2) Provides evidence acceptable to the director that the
applicant obtained a corporate surety bond as provided in section
9 of this 2009 Act if the applicant employs or intends to employ
a mortgage loan originator, as defined in section 1 of this 2009
Act, or is otherwise subject to sections 1 to 13 of this 2009
Act;
(3) Certifies to the director in a form and manner the director
specifies by rule that the applicant has independently verified
that every individual the applicant or licensee hired or intends
to hire as a mortgage loan originator meets the requirements set
forth in sections 1 to 13 of this 2009 Act and in ORS 59.972; + }
{ - (2) - } { + (4) + } Pays the fee specified in ORS
446.721 for issuance of a manufactured structure dealer license;
and
{ - (3) - } { + (5) + } Completes the application for a
dealer license in a form approved by the { - department - }
{ + director + } that includes:
(a) The name and residence address of the applicant. If the
applicant is a firm or partnership, the application must include
the names and residence addresses of the members of the
{ - applicant - } { + firm or partnership + }. If the
applicant is a corporation, the application must include the
names and residence addresses of the principal officers of the
{ - applicant - } { + corporation + } and the name of the
state in which the { - applicant - } { + corporation + } is
incorporated.
(b) The name under which the business will be conducted.
(c) The street address, including city and county in Oregon,
where the business will be conducted.
(d) { + A statement that indicates + }whether { + the
applicant handles + } used manufactured structures { - are
handled - } .
(e) An affidavit from the applicant showing that the applicant
will act as a manufactured structure dealer and will conduct
business at the location given on the application.
(f) If the street address where the dealer will conduct the
business is in a residential zone, a statement by the dealer that
all manufactured structures sold or displayed at that address
will meet any architectural and aesthetic standards regulating
the placement of manufactured structures in that residential
zone.
(g) { - Any - } Information { - required by - } the
{ - department - } { + director requires + } to efficiently
regulate manufactured structures, manufactured structure dealers
and dealerships or other relevant information { - required
by - } the { - department - } { + director requires + }.
(h) If the applicant will offer for sale new manufactured
structures that are recreational vehicles greater than eight and
one-half feet in width, an affidavit from the applicant stating
that the applicant will maintain a recreational vehicle service
facility for those recreational vehicles at a street address
provided in the application.
SECTION 30. ORS 446.696 is amended to read:
446.696. A manufactured structure dealer license is valid for
three years, but the { + Director of the + }Department of
Consumer and Business Services may adjust the term of an initial
license for the purpose of establishing uniform expiration dates.
A dealer may renew a license as provided by the
{ - department - } { + director + }. The
{ - department - } { + director + } may renew a license only
if the dealer:
(1) Delivers to the { - department - } { + director + } a
bond or letter of credit that meets the requirements under ORS
446.726.
{ + (2) Provides evidence acceptable to the director that the
dealer obtained a corporate surety bond as provided in section 9
of this 2009 Act if the dealer employs or intends to employ a
mortgage loan originator, as defined in section 1 of this 2009
Act, or is otherwise subject to sections 1 to 13 of this 2009
Act.
(3) Certifies to the director in a form and manner the director
specifies by rule that the dealer has independently verified that
every individual the dealer hired or intends to hire as a
mortgage loan originator meets the requirements set forth in
sections 1 to 13 of this 2009 Act and in ORS 59.972. + }
{ - (2) - } { + (4) + } Pays the fee specified in ORS
446.721 for renewal of a manufactured structure dealer license.
{ - (3) - } { + (5) + } Submits a completed application for
renewal in a form approved by the { - department - } { +
director + } that includes:
(a) The name and residence address of the dealer. If the dealer
is a firm or partnership, the application must include the names
and addresses of the members of the { - dealer - } { + firm
or partnership + }. If the dealer is a corporation, the
application must include the names and addresses of the principal
officers of the
{ - dealer - } { + corporation + } and the name of the state
in which the
{ - dealer - } { + corporation + } is incorporated.
(b) The name under which the business will be conducted.
(c) The street address, including city and county in Oregon,
where the business will be conducted.
(d) If the location of the dealership is being changed at the
time of renewal:
(A) For a business that will be conducted in a residential
zone, a statement by the dealer that all manufactured structures
sold or displayed at that address will meet any architectural and
aesthetic standards regulating the placement of manufactured
structures in that residential zone.
(B) For a business that will offer for sale new manufactured
structures that are recreational vehicles greater than eight and
one-half feet in width, a certificate from the applicant stating
that the applicant will maintain a recreational vehicle service
facility for those recreational vehicles at a street address
provided in the application.
(e) { - Any - } Information { - required by - } the
{ - department - } { + director requires + } to efficiently
regulate manufactured structure dealers and dealerships or other
relevant information { - required by - } the
{ - department - } { + director requires + }.
SECTION 31. ORS 446.706 is amended to read:
446.706. (1) A person who holds a limited manufactured
structure dealer license issued under this section may sell
during a calendar year up to 10 manufactured dwellings located at
a manufactured dwelling park identified in the license. The
manufactured dwellings sold under a limited manufactured
structure dealer license must be dwellings that:
(a) Have been abandoned as described in ORS 90.675 at any
manufactured dwelling park. If the manufactured dwelling is not
subject to sale by the limited manufactured structure dealer
under ORS 90.675 (10), the dealer must have the certificate of
title or registration for the dwelling transferred to the dealer
prior to offering the dwelling for sale; or
(b) Have been purchased by the park owner from a person holding
title, and at the time of purchase by the park owner, were sited
in the manufactured dwelling park identified in the license.
(2) Notwithstanding ORS 90.525, if a limited manufactured
structure dealer sells a manufactured dwelling that was abandoned
at a manufactured dwelling park other than the park where the
dwelling is being sold, the sale terms for the manufactured
dwelling must require that the dwelling is to be sited under a
rental agreement at the park where sold for at least 12 months
following the sale.
(3) Except as provided in ORS 446.741, the { + Director of
the + } Department of Consumer and Business Services shall issue
a limited manufactured structure dealer license to a person if
the person:
(a) Owns or operates a manufactured dwelling park as defined in
ORS 446.003;
(b) Submits a completed application for a limited manufactured
structure dealer license in a form approved by the
{ - department - } { + director + };
(c) Delivers to the { - department - } { + director + } a
bond or letter of credit that meets the requirements under ORS
446.726, except that the bond or letter of credit must be in the
sum of $15,000 for each year that the license is valid;
{ + (d) Delivers to the director a corporate surety bond that
meets the requirements specified in section 9 of this 2009 Act if
the person employs or intends to employ a mortgage loan
originator, as defined in section 1 of this 2009 Act, or is
otherwise subject to sections 1 to 13 of this 2009 Act;
(e) Certifies to the director in a form and manner the director
specifies by rule that the person has independently verified that
every individual the person hired or intends to hire as a
mortgage loan originator meets the requirements set forth in
sections 1 to 13 of this 2009 Act and in ORS 59.972; + }
{ - (d) - } { + (f) + } Is 18 years of age or older or is
legally emancipated; and
{ - (e) - } { + (g) + } Pays the fee specified in ORS
446.721 for issuance of a limited manufactured structure dealer
license.
(4) If the person is a firm or partnership, the application for
a limited manufactured structure dealer license must include the
names and residence addresses of the members of the firm or
partnership. If the person is a corporation, the application must
include the names of the principal officers of the corporation
and
{ - their - } residence addresses { + of the officers + } and
the name of the state under whose laws the corporation is
organized. If the person is the owner of a manufactured dwelling
park, the person may submit a joint application on behalf of the
person and a named park operator employed by the person. If the
person is the operator of a manufactured dwelling park, the
application must include the name and signature of the park
owner.
(5) A limited manufactured structure dealer license is valid
for use at a single manufactured dwelling park. The manufactured
dwelling park location must be specified in the license
application. A limited manufactured structure dealer may not
employ a salesperson.
(6) A limited manufactured structure dealer license is valid
for two years, but the { - department - } { + director + }
may adjust the term of an initial license for the purpose of
establishing uniform expiration dates.
(7) Notwithstanding subsection (6) of this section, the limited
manufactured structure dealer license for the person expires
immediately if the person ceases to be an operator or owner of
the manufactured dwelling park at which the license may be used.
The owner of a manufactured dwelling park shall immediately
notify the { - department - } { + director + } if a person
licensed under this section ceases to be an owner or operator of
a manufactured dwelling park at which the license may be used.
(8) Notwithstanding subsections (6) and (7) of this section, if
a licensed person ceases to be an operator of the manufactured
dwelling park, the park owner may apply to have a corrected
license issued to a new operator employed by the owner. A
corrected license issued under this subsection is valid for the
unexpired portion of the original license term. The
{ - department - } { + director + } shall charge the fee
specified in ORS 446.721 for issuing a corrected license.
(9) A limited manufactured structure dealer may renew a license
as provided by the { - department - } { + director + }. The
{ - department - } { + director + } shall renew a license only
if the dealer:
(a) Submits a completed application for renewal in a form
approved by the { - department - } { + director + };
(b) Delivers to the department a bond or letter of credit that
meets the requirements described in subsection (3) of this
section; and
(c) Pays the fee specified in ORS 446.721 for renewal of a
limited manufactured structure dealer license.
SECTION 32. ORS 446.741 is amended to read:
446.741. (1) The { + Director of the + } Department of
Consumer and Business Services may revoke or suspend a
manufactured structure dealer license, or place a dealer on
probation, if the dealer does any of the following:
(a) { - Violates any - } { + Commits an act that is + }
grounds for suspension, revocation or probation { + under
rules + } { - adopted by - } the
{ - department - } { + director adopted + } { - by rule - }
.
(b) Fails to comply with the requirements for notices or
reports of the transfer of interest in manufactured structures.
(c) Moves a manufactured structure or causes a manufactured
structure to be moved without complying with the requirements for
variance permits under ORS 818.200 and trip permits under ORS
446.631.
(d) Knowingly provides false information on an application for
a dealer license, supplemental license or corrected dealer
license.
(e) Deals in a manufactured structure that both before and
after the sale is assessed as real property under ORS 308.875 or
is recorded in the deed records of a county. This paragraph does
not apply if an ownership document is issued for the manufactured
structure prior to sale.
(f) Employs a person in an administrative or managerial
capacity while the person is disqualified under subsection (5) of
this section.
{ + (g) Fails, in conducting activities of a mortgage loan
originator, to comply with the provisions of:
(A) The Truth in Lending Act, 15 U.S.C. 1601 et seq. and
Regulation Z, 12 C.F.R. part 226, as in effect on October 1,
2009;
(B) The Real Estate Settlement Procedures Act, 12 U.S.C. 2601
et seq. and Regulation X, 24 C.F.R. part 3500, as in effect on
January 1, 2010;
(C) The Equal Credit Opportunity Act, 15 U.S.C. 1691 et seq.
and Regulation B, 12 C.F.R. 202.9, 202.11, 202.12 and 202.14, as
in effect on the effective date of this 2009 Act; or
(D) 12 U.S.C. 5101 et seq. and regulations adopted under 12
U.S.C. 5101 et seq.
(h) Fails to certify to the director in a form and manner the
director specifies by rule that the dealer has independently
verified that every individual the dealer hired or intends to
hire as a mortgage loan originator meets the requirements set
forth in sections 1 to 13 of this 2009 Act and ORS 59.972.
(i) Employs a device, scheme or artifice to defraud or engage
in an act, practice or course of business that operates or would
operate as a fraud or deceit.
(j) Knowingly makes an untrue statement of a material fact or
omits from a statement a material fact that would make the
statement not misleading in light of the circumstances under
which the dealer makes the statement.
(k) Makes or files or causes to be made or filed with the
director a statement, report or document that the dealer knows is
false in a material respect or matter. + }
(2) The { - department - } { + director + } shall cancel a
manufactured structure dealer license immediately upon receipt of
legal notice that { - the - } { + a + } bond described under
ORS 446.726 { + or under section 9 of this 2009 Act + } is
canceled.
(3) Upon suspension, revocation or cancellation of a
manufactured structure dealer license under this section, the
{ - department - } { + director + } shall demand the return
of the license.
(4) The { - department - } { + director + } shall cancel a
dealer license or supplemental license immediately upon receipt
of notice that zoning approval for a place of business has been
revoked.
(5) If the { - department - } { + director + } revokes a
manufactured structure dealer license pursuant to subsection (1)
of this section, the { - department - } { + director + }
shall disqualify the person whose license is revoked from
obtaining any type of license as a manufactured structure dealer
and from working in an administrative or managerial capacity for
any type of manufactured structure dealer, for a period of not
more than five years after the date the revocation becomes
effective. If the person applies for licensing as a manufactured
structure dealer following a period of disqualification under
this subsection, the person must meet the requirements for
issuance of an initial manufactured structure dealer license.
SECTION 33. ORS 725.010 is amended to read:
725.010. As used in this chapter:
(1)(a) 'Broker or facilitator' means a person that conducts a
business in which, for a fee or consideration, the person:
(A) Processes, receives or accepts for delivery to a lender an
application for a loan, individually or in conjunction or
cooperation with another person;
(B) Accepts and delivers to a lender all or most of the
proceeds of a payment made in connection with a loan; or
(C) Assists in making a loan in a material capacity other than
as a lender.
(b) 'Broker or facilitator' does not include a mortgage broker
{ - or loan originator, as those terms are - } { + , as that
term is + } defined in ORS 59.840, { + a mortgage loan
originator, as that term is defined in section 1 of this 2009
Act, + } or an employee of a licensee.
(2) 'Consumer finance loan' means a loan or line of credit that
is unsecured or secured by personal or real property and that has
periodic payments and terms longer than 60 days.
(3) 'Licensee' means a person licensed under this chapter.
SECTION 34. ORS 725.140 is amended to read:
725.140. (1) Conditioned upon { - the - } { + an + }
applicant's compliance with this chapter and the payment of the
license fee, the Director of the Department of Consumer and
Business Services, within 90 days after the date { - of
filing - } { + the applicant filed + } the application
{ - referred to - } { + described + } in ORS 725.120, shall
disapprove the application or shall issue and deliver a license
to the applicant to make loans in accordance with this chapter at
the location specified in the application. However, before
issuing a license, the director must first find upon
investigation { + that + }:
(a) { - That - } The financial responsibility, experience,
character and general fitness of the applicant, and of the
members thereof if the applicant is a partnership or association,
and of the officers and directors thereof if the applicant is a
corporation, are such as to command the confidence of the
community and to warrant the belief that the business will be
operated honestly, fairly and efficiently within the purposes of
this chapter; { - and - }
(b) { - That - } Grounds { - for disapproval of - } { +
to disapprove + } an application described in ORS 725.145 do not
exist and that, in the judgment of the director, { - there
are - } no other reasons or conditions { - that would - }
warrant the refusal to grant a license { - . - } { + ; and
(c) The applicant obtained a corporate surety bond that meets
the requirements specified in section 9 of this 2009 Act if the
applicant employs or intends to employ a mortgage loan
originator, as defined in section 1 of this 2009 Act, or is
otherwise subject to sections 1 to 13 of this 2009 Act. + }
(2) A license issued under this section { - shall be - }
{ + is + } a continuing license and { - shall - } { +
will + } remain in full force and effect until the { + licensee
surrenders the + } license { - is surrendered by the
licensee - } as provided in ORS 725.250 or { + the director
revokes or suspends the license + } { - revoked or
suspended - } as provided in ORS 725.230.
SECTION 35. ORS 725.230 is amended to read:
725.230. (1) The Director of the Department of Consumer and
Business Services may revoke { - any - } { + a + } license
under this chapter upon 10 days' notice to the licensee stating
the contemplated action and in general the grounds
{ - therefor - } { + for the action + } and
{ - upon - } { + after giving the licensee + } reasonable
opportunity for a hearing { - in connection therewith - } , if
the director finds that:
(a) The licensee { - has - } failed to pay the annual
license fee or to comply with { - any - } { + a + } demand,
ruling or requirement of the director made pursuant to this
chapter or { + , if the licensee is a corporation, + } to comply
with { - the - } provisions of law { + that require the
licensee + } to keep the corporation in good standing { - if
such licensee is a corporation - } ;
(b) The licensee has violated { - any - } { + a
provision + } { - provisions - } of this chapter or
{ - any - } { + a + } rule made by the director under the
authority of this chapter; { - or - }
{ + (c) The licensee employs mortgage loan originators
licensed under sections 1 to 13 of this 2009 Act and failed to:
(A) File with the director and to maintain a corporate surety
bond required under section 9 of this 2009 Act; or
(B) Certify to the director in a form and manner the director
specifies by rule that the licensee has independently verified
that every individual the licensee hired or intends to hire as a
mortgage loan originator meets the requirements set forth in
sections 1 to 13 of this 2009 Act and ORS 59.972;
(d) The licensee, in connection with the activities of a
mortgage loan originator:
(A) Failed to maintain a corporate surety bond as provided in
section 9 of this 2009 Act;
(B) Failed to comply with:
(i) The Truth in Lending Act, 15 U.S.C. 1601 et seq. and
Regulation Z, 12 C.F.R. part 226, as in effect on October 1,
2009;
(ii) The Real Estate Settlement Procedures Act, 12 U.S.C. 2601
et seq. and Regulation X, 24 C.F.R. part 3500, as in effect on
January 1, 2010;
(iii) The Equal Credit Opportunity Act, 15 U.S.C. 1691 et seq.
and Regulation B, 12 C.F.R. 202.9, 202.11, 202.12 and 202.14, as
in effect on the effective date of this 2009 Act; or
(iv) 12 U.S.C. 5101 et seq. and regulations adopted under 12
U.S.C. 5101 et seq.;
(e) The licensee employed a device, scheme or artifice to
defraud or engage in an act, practice or course of business that
operates or would operate as a fraud or deceit;
(f) The licensee knowingly made an untrue statement of a
material fact or omitted from a statement a material fact that
would make the statement not misleading in light of the
circumstances under which the licensee made the statement;
(g) The licensee made or filed or caused to be made or filed
with the director a statement, report or document that the
licensee knew was false in a material respect or matter; or + }
{ - (c) - } { + (h) + } { - Any - } { + A + } fact or
condition exists { - which - } { + that + }, if
{ - it - } { + the fact or condition + } had existed at the
time { + the licensee originally applied + } { - of the
original application - } for { - such - } { + the + }
license, clearly would have warranted the director in refusing
originally to issue the license.
(2) The director, without notice or hearing, may suspend
{ - any - } { + a + } license { + issued under this
chapter + } for a period not exceeding 30 days, pending
investigation.
(3) The director may revoke or suspend only the particular
license with respect to which grounds for revocation or
suspension may occur or exist, or, if the director finds that
{ - such - } { + the + } grounds for revocation or suspension
are of general application to all { - offices or to - } { +
or + } more than one { + of the licensee's offices + }
{ - office operated by a licensee - } , the director may revoke
or suspend all the licenses or such number of { + the + }
licenses issued to the licensee as the grounds for revocation or
suspension apply to, as the case may be.
SECTION 36. { + ORS 59.969, 59.970, 59.973, 59.975 and 59.977
are repealed. + }
SECTION 37. { + (1) Sections 1 to 13 of this 2009 Act and the
amendments to ORS 59.840, 59.850, 59.855, 59.860, 59.865, 59.875,
59.880, 59.900, 59.905, 59.925, 59.962, 59.967, 59.971, 59.972,
59.992, 446.691, 446.696, 446.706, 446.741, 725.010, 725.140 and
725.230 by sections 14 to 35 of this 2009 Act and the repeal of
ORS 59.969, 59.970, 59.973, 59.975 and 59.977 by section 36 of
this 2009 Act become operative on July 31, 2010.
(2) The Director of the Department of Consumer and Business
Services may take any action before July 31, 2010, that is
necessary to enable the director to exercise, on or after July
31, 2010, all of the duties, functions and powers conferred on
the director by sections 1 to 13 of this 2009 Act and the
amendments to ORS 59.840, 59.850, 59.855, 59.860, 59.865, 59.875,
59.880, 59.900, 59.905, 59.925, 59.962, 59.967, 59.971, 59.972,
59.992, 446.691, 446.696, 446.706, 446.741, 725.010, 725.140 and
725.230 by sections 14 to 35 of this 2009 Act. + }
SECTION 38. { + This 2009 Act being necessary for the
immediate preservation of the public peace, health and safety, an
emergency is declared to exist, and this 2009 Act takes effect on
its passage. + }
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