October 16, 2007, Introduced by Senators CLARKE, RICHARDVILLE, ANDERSON, SANBORN, KAHN, GLEASON, SCHAUER, BIRKHOLZ, STAMAS, OLSHOVE, BROWN, CASSIS and HUNTER and referred to the Committee on Banking and Financial Institutions.
A bill to amend 1987 PA 173, entitled
"Mortgage brokers, lenders, and servicers licensing act,"
by amending the title and section 1a (MCL 445.1651a), section 1a as
amended by 2002 PA 391.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
TITLE
An act to define and regulate mortgage brokers, mortgage
lenders, and mortgage servicers and their loan officers; to
prescribe
the powers and duties of the financial institutions
bureau
and certain public officers and
agencies; to provide for the
promulgation of rules; and to provide remedies and penalties.
Sec.
1a. As used in this act: , unless the context requires
otherwise:
(a) "Affiliate" means a person or group of persons that
directly or indirectly through 1 or more intermediaries controls,
is controlled by, or is under common control with another person
and engaged in a business or transaction regulated by this act.
(b) "Board" means the mortgage industry advisory board created
in section 33.
(c) (b)
"Commissioner" means the
commissioner of the office of
financial
and insurance services of the department of consumer and
industry
services labor and economic
growth or his or her
authorized agent.
(d) (c)
"Construction loan" means
a mortgage loan for the
purpose
of constructing to construct a 1-to-4 family dwelling,
which
loan that is approved and closed before completion of the
construction of the improvement on the real property.
(e) (d)
"Control person" means a
director or executive officer
of a licensee or registrant or a person who has the authority to
participate in the direction, directly or indirectly through 1 or
more other persons, of the management or policies of a licensee or
registrant.
(f) (e)
"Depository financial
institution" means a state or
nationally chartered bank, a state or federally chartered savings
and loan association, savings bank, or credit union, or an entity
of the federally chartered farm credit system.
(g) (f)
"Executive officer" means
an officer, member, or
partner
of a licensee or registrant. , including The term includes
the chief executive officer, president, vice president, chief
financial
officer, controller, or compliance officer , or an
individual holding any other similar position.
(h) (g)
"Financial licensing act"
means the consumer financial
services act, 1988 PA 161, MCL 487.2051 to 487.2072, and any of the
acts listed in section 2 of the consumer financial services act,
1988 PA 161, MCL 487.2052.
(i) (h)
"Firm commitment" means
an underwriting in which a
broker-dealer commits to buy the mortgage loan or the entire issue
of securities based upon or backed by 1 or more mortgage loans and
assumes all financial responsibility for any unsold securities.
(j) (i)
"Individual investor"
means a person residing that
resides
in this state or having has its
principal place of business
in
this state. , other than The term does not include a
bank,
savings bank, savings and loan association, credit union, trust
company, insurance company, investment company as defined in the
investment
company act of 1940, title I of chapter 686, 54 Stat.
789,
15 U.S.C. USC 80a-1
to 80a-3 and 80a-4 to 80a-64, pension or
profit
sharing plan , if
the assets of which the plan are
managed
by a bank or trust company or other institutional manager,
financial institution, institutional manager, broker-dealer that is
a member of the New York stock exchange or registered under the
uniform securities act, 1964 PA 265, MCL 451.501 to 451.818, the
federal national mortgage association, the government national
mortgage association, the federal home loan mortgage corporation,
or a mortgage lender or mortgage servicer.
(k) (j)
"License" means a license
issued under this act.
(l) (k)
"Licensee" means a person
licensed or required to be
licensed under this act.
(m) "Loan officer" means an individual who is an employee of
only 1 mortgage broker, mortgage lender, or mortgage servicer; who
originates mortgage loans; and who is not an employee of a
depository financial institution or a subsidiary or affiliate of a
depository financial institution. The term does not include an
individual who performs clerical or administrative tasks for his or
her employer if that individual does not solicit borrowers, accept
applications, or negotiate the terms of the loans on the employer’s
behalf.
(n) "Loan officer registrant" means an individual who meets
any of the following:
(i) He or she is currently registered under section 2a.
(ii) He or she filed an application for registration under
section 2a within his or her first 90 calendar days of employment
with a licensee or registrant and that application is pending.
(iii) He or she has been employed as a loan officer by a
licensee or registrant for fewer than 91 calendar days.
(o) (l) "Mortgage
broker" means a person who, directly or
indirectly, does 1 or both of the following:
(i) Serves or offers to serve as an agent for a person in an
attempt to obtain a mortgage loan.
(ii) Serves or offers to serve as an agent for a person who
makes or offers to make mortgage loans.
(p) (m)
"Mortgage lender" means a
person who, directly or
indirectly, makes or offers to make mortgage loans.
(q) (n)
"Mortgage loan" means a
loan secured by a first
mortgage on real property located in this state and used, or
improved
to be used for use, as a dwelling and designed for
occupancy by 4 or fewer families or a land contract covering real
property
located in this state used, or improved to be used for
use, as a dwelling and designed for occupancy by 4 or fewer
families. A mortgage loan does not include a home improvement
installment contract under the home improvement finance act, 1965
PA 332, MCL 445.1101 to 445.1431.
(r) (o)
"Mortgage servicer" means
a person who, directly or
indirectly, services or offers to service mortgage loans.
(s) "Originate" means any of the following:
(i) To negotiate, arrange, or offer to negotiate or arrange a
mortgage loan between a mortgage lender and 1 or more individuals.
(ii) To place, assist in placing, or find a mortgage loan for 1
or more individuals.
(t) (p)
"Person" means an
individual, corporation, limited
liability company, partnership, association, governmental entity,
or any other legal entity.
(u) (q)
"Real estate broker"
means a broker or associate
broker licensed under article 25 of the occupational code, 1980 PA
299, MCL 339.2501 to 339.2518.
(v) (r)
"Real estate salesperson"
means a salesperson licensed
under article 25 of the occupational code, 1980 PA 299, MCL
339.2501 to 339.2518.
(w) (s)
"Register" means filing a
notice with the commissioner
on a form prescribed by the commissioner that notifies the
commissioner of the intent to engage in the activities of a
mortgage
broker, mortgage lender, or mortgage servicer, or loan
officer in this state and the payment of any fees required under
this act, along with the other documents, proofs, and fees required
by the commissioner.
(x) (t)
"Registrant" means a
person that is registered under
section
6 or required to be registered register under
this act
section 6. The term does not include a loan officer registrant.
(y) (u)
"Service" means the
collection or remittance, or the
right or obligation to collect or remit, for a lender, noteowner,
noteholder, mortgage servicer, or the licensee's or registrant's
own account of 4 or more installment payments of the principal,
interest, or an amount placed in escrow under a mortgage loan,
mortgage servicing agreement, or an agreement with the mortgagor.
Enacting section 1. This amendatory act does not take effect
unless all of the following bills of the 94th Legislature are
enacted into law:
(a) Senate Bill No. 826.
(b) House Bill No. 5288.
(c) Senate Bill No. 829.
(d) House Bill No. 5289.
(e) Senate Bill No. 830.
(f) Senate Bill No. 831.
(g) House Bill No. 5287.
(h) House Bill No. 5290.
(i) House Bill No. 5291.
(j) Senate Bill No. 833.
(k) Senate Bill No. 832.