76R14863 CLG-F
By Carona S.B. No. 1074
Substitute the following for S.B. No. 1074:
By Averitt C.S.S.B. No. 1074
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the licensing of mortgage brokers; providing penalties.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Subchapter D, Chapter 11, Finance Code, is
1-5 amended by adding Section 11.306 to read as follows:
1-6 Sec. 11.306. MORTGAGE BROKERS. The finance commission may:
1-7 (1) review any action or rule adopted by the savings
1-8 and loan commissioner under Chapter 156; and
1-9 (2) direct the savings and loan commissioner to adopt,
1-10 repeal, or amend any rule or other action the savings and loan
1-11 commissioner may undertake under Chapter 156.
1-12 SECTION 2. Subtitle E, Title 3, Finance Code, is amended by
1-13 adding Chapter 156 to read as follows:
1-14 CHAPTER 156. MORTGAGE BROKERS
1-15 SUBCHAPTER A. GENERAL PROVISIONS
1-16 Sec. 156.001. SHORT TITLE. This chapter may be cited as the
1-17 Mortgage Broker License Act.
1-18 Sec. 156.002. DEFINITIONS. In this chapter:
1-19 (1) "Commissioner" means the savings and loan
1-20 commissioner.
1-21 (2) "Disciplinary action" means an order by the
1-22 commissioner that requires one or more of the following:
1-23 (A) suspension or revocation of a license under
2-1 this chapter;
2-2 (B) probation of a suspension or revocation of a
2-3 license under this chapter on terms and conditions that the
2-4 commissioner determines appropriate;
2-5 (C) a reprimand of a person licensed under this
2-6 chapter; or
2-7 (D) an administrative penalty imposed on a
2-8 person licensed under this chapter under Section 156.302.
2-9 (3) "Finance commission" means the Finance Commission
2-10 of Texas.
2-11 (4) "Fund" means the mortgage broker recovery fund
2-12 established by the commissioner under Subchapter F.
2-13 (5) "Loan officer" means an individual sponsored by a
2-14 licensed mortgage broker for the purposes of performing the acts of
2-15 a mortgage broker. The term does not include:
2-16 (A) an individual who performs only clerical
2-17 functions such as delivering a loan application to a mortgage
2-18 broker or mortgage banker or gathering information related to a
2-19 mortgage loan application on behalf of the prospective borrower,
2-20 mortgage broker, or mortgage banker; or
2-21 (B) an individual who performs functions of a
2-22 loan processor.
2-23 (6) "Loan processor" means an individual who works
2-24 under the instruction of a loan officer or mortgage broker and
2-25 performs only clerical functions such as gathering information,
2-26 requesting information, word processing, sending correspondence, or
2-27 assembling files.
3-1 (7) "Mortgage applicant" means a person who is
3-2 solicited to use or who uses a mortgage broker to obtain a mortgage
3-3 loan.
3-4 (8) "Mortgage banker" means a person who is:
3-5 (A) approved or authorized by the United States
3-6 Department of Housing and Urban Development as a mortgagee with
3-7 direct endorsement underwriting authority;
3-8 (B) an approved seller or servicer of the
3-9 Federal National Mortgage Association;
3-10 (C) an approved seller or servicer of the
3-11 Federal Home Loan Mortgage Association; or
3-12 (D) an approved issuer for the Governmental
3-13 National Mortgage Association.
3-14 (9) "Mortgage broker" means a person who receives an
3-15 application from a prospective borrower for the purposes of making
3-16 a mortgage loan from that person's own funds or from the funds of
3-17 another person. The term does not include:
3-18 (A) a person who performs only clerical
3-19 functions such as delivering a loan application to a mortgage
3-20 broker or mortgage banker or gathering information related to a
3-21 mortgage loan application on behalf of the prospective borrower,
3-22 mortgage broker, or mortgage banker; or
3-23 (B) a person who performs functions of a loan
3-24 processor.
3-25 (10) "Mortgage loan" means a debt against real estate
3-26 secured by a first-lien security interest against one-to-four
3-27 family residential real estate created by a deed of trust, security
4-1 deed, or other security instrument.
4-2 Sec. 156.003. SECONDARY MARKET TRANSACTIONS. This chapter
4-3 does not prohibit a mortgage broker from receiving compensation
4-4 from a party other than the mortgage applicant for the sale,
4-5 transfer, assignment, or release of rights on the closing of a
4-6 mortgage transaction.
4-7 Sec. 156.004. DISCLOSURE TO APPLICANT. At the time an
4-8 applicant submits an application to a mortgage broker, the mortgage
4-9 broker shall provide to the applicant a disclosure that specifies
4-10 the nature of the relationship between applicant and broker, the
4-11 duties the broker has to the applicant, and how the mortgage broker
4-12 will be compensated. The commissioner, by rule, shall promulgate a
4-13 standard disclosure form to be used by the mortgage broker.
4-14 Sec. 156.005. AFFILIATED BUSINESS ARRANGEMENTS. Unless
4-15 prohibited by federal law, this chapter may not be construed to
4-16 prevent affiliated or controlled business arrangements or loan
4-17 origination services by or between mortgage brokers and other
4-18 professionals if the mortgage broker complies with all applicable
4-19 federal laws permitting those arrangements or services.
4-20 (Sections 156.006 to 156.100 reserved for expansion
4-21 SUBCHAPTER B. ADMINISTRATION PROVISIONS
4-22 Sec. 156.101. ADMINISTRATION OF CHAPTER. (a) The
4-23 commissioner shall administer this chapter.
4-24 (b) The commissioner may hire employees as necessary to
4-25 administer this chapter. The salaries of the employees shall be
4-26 set by the commissioner in amounts not to exceed the amounts set by
4-27 the General Appropriations Act.
5-1 (c) The commissioner may employ a general counsel,
5-2 attorneys, investigators, and support staff to administer and
5-3 enforce this chapter.
5-4 Sec. 156.102. RULEMAKING AUTHORITY. (a) Subject to review
5-5 and compliance with the directives of the finance commission as
5-6 provided by Section 11.306, the commissioner may adopt and enforce
5-7 rules necessary for the intent of or to ensure compliance with this
5-8 chapter.
5-9 (b) The commissioner may adopt rules to prohibit false,
5-10 misleading, or deceptive practices by mortgage brokers and loan
5-11 officers but may not adopt any other rules restricting competitive
5-12 bidding or advertising by mortgage brokers or loan officers. When
5-13 adopting rules under this subsection, the commissioner may not
5-14 restrict:
5-15 (1) the use of any medium for an advertisement;
5-16 (2) the personal appearance of or voice of a person in
5-17 an advertisement;
5-18 (3) the size or duration of an advertisement; or
5-19 (4) a mortgage broker's or loan officer's
5-20 advertisement under a trade name.
5-21 (c) The commissioner may adopt rules regarding books and
5-22 records that a person licensed under this chapter is required to
5-23 keep, including the location at which the books and records must be
5-24 kept.
5-25 (d) The commissioner shall consult with the mortgage broker
5-26 advisory committee when proposing and adopting rules under this
5-27 chapter.
6-1 Sec. 156.103. POWERS OF COMMISSIONER. (a) In addition to
6-2 any other action, proceeding, or remedy authorized by law, the
6-3 commissioner may institute an action in the commissioner's name to
6-4 enjoin a violation of this chapter or a rule adopted under this
6-5 chapter. To sustain an action filed under this subsection, it is
6-6 not necessary to allege or prove that an adequate remedy at law
6-7 does not exist or that substantial or irreparable damage would
6-8 result from a continued violation of this chapter.
6-9 (b) The commissioner is not required to provide an appeal
6-10 bond in any action or proceeding to enforce this chapter.
6-11 (c) The commissioner may authorize specific employees to
6-12 conduct hearings and make recommendations for final decisions in
6-13 contested cases.
6-14 Sec. 156.104. MORTGAGE BROKER ADVISORY COMMITTEE. (a) The
6-15 mortgage broker advisory committee is created to advise and assist
6-16 the commissioner.
6-17 (b) The advisory committee is composed of six members to be
6-18 appointed as follows:
6-19 (1) the commissioner shall appoint four members, each
6-20 of whom:
6-21 (A) must hold a mortgage broker license;
6-22 (B) is actively engaged in the business of
6-23 brokering loans at the time of appointment; and
6-24 (C) has been primarily engaged in the business
6-25 of brokering mortgage loans for at least two years before the
6-26 member's appointment; and
6-27 (2) the Texas Real Estate Commission shall appoint two
7-1 members, each of whom must hold a real estate broker or salesperson
7-2 license.
7-3 (c) Appointments to the advisory committee shall be made
7-4 without regard to the sex, race, color, age, disability, religion,
7-5 or national origin of the appointees.
7-6 (d) The members of the advisory committee serve for a
7-7 staggered three-year term, with the terms of two members expiring
7-8 February 1 of each year.
7-9 (e) The advisory committee shall meet at least twice a year
7-10 at the call of the commissioner.
7-11 (f) The commissioner may remove a member of the advisory
7-12 committee if:
7-13 (1) the member does not have at the time of
7-14 appointment the qualifications required by Subsection (b); or
7-15 (2) the commissioner determines that the member cannot
7-16 discharge the member's duties for a substantial part of the term
7-17 for which the member is appointed.
7-18 (g) In the event of a vacancy during a term, the appointing
7-19 entity or official shall fill the vacancy for the unexpired part of
7-20 the term with a person who meets the qualifications of the vacated
7-21 position.
7-22 (h) In addition to other powers and duties delegated to it
7-23 by the commissioner, the advisory committee shall advise the
7-24 commissioner with respect to:
7-25 (1) the proposal and adoption of rules relating to:
7-26 (A) the licensing of mortgage brokers and loan
7-27 officers;
8-1 (B) the education and experience requirements
8-2 for licensing mortgage brokers and loan officers;
8-3 (C) conduct and ethics of mortgage brokers and
8-4 loan officers;
8-5 (D) continuing education for licensed mortgage
8-6 brokers and loan officers and the types of courses acceptable as
8-7 continuing education courses under this chapter; and
8-8 (E) the granting or denying of an application or
8-9 request for renewal for a mortgage broker license or loan officer
8-10 license;
8-11 (2) the form of or format for any applications or
8-12 other documents under this chapter; and
8-13 (3) the interpretation, implementation, and
8-14 enforcement of this chapter.
8-15 (i) Each member of the advisory committee is entitled to a
8-16 per diem allowance and to reimbursement of travel expenses
8-17 necessarily incurred in performing functions as a member of the
8-18 committee, subject to any applicable limitation in the General
8-19 Appropriations Act.
8-20 (Sections 156.105 to 156.200 reserved for expansion)
8-21 SUBCHAPTER C. MORTGAGE BROKER LICENSE AND LOAN OFFICER LICENSE
8-22 Sec. 156.201. LICENSES REQUIRED. (a) A person may not act
8-23 in the capacity of, engage in the business of, or advertise or hold
8-24 that person out as engaging in or conducting the business of a
8-25 mortgage broker in this state unless the person holds an active
8-26 mortgage broker license or is exempt under Section 156.202.
8-27 (b) An individual may not act or attempt to act as a loan
9-1 officer unless the individual at the time is:
9-2 (1) sponsored by a licensed mortgage broker and acting
9-3 for the mortgage broker; or
9-4 (2) exempt under Section 156.202.
9-5 (c) Each mortgage broker licensed under this chapter is
9-6 responsible to the commissioner and members of the public for any
9-7 act or conduct performed under this chapter by the mortgage broker
9-8 or a loan officer sponsored by or acting for the mortgage broker.
9-9 Sec. 156.202. EXEMPTIONS. This chapter does not apply to:
9-10 (1) any of the following entities or an employee of
9-11 any of the following entities provided the employee is acting for
9-12 the benefit of the employer:
9-13 (A) a bank, savings bank, or savings and loan
9-14 association, or a subsidiary or an affiliate of a bank, savings
9-15 bank, or savings and loan association;
9-16 (B) a state or federal credit union;
9-17 (C) an insurance company licensed or authorized
9-18 to do business in this state under the Insurance Code;
9-19 (D) a mortgage banker; or
9-20 (E) an organization that qualifies for an
9-21 exemption from state franchise and sales tax as a 501(c)(3)
9-22 organization;
9-23 (2) an individual who makes a mortgage loan from the
9-24 individual's own funds to a spouse, former spouse, or persons in
9-25 the lineal line of consanguinity of the individual lending the
9-26 money;
9-27 (3) an owner of real property who makes a mortgage
10-1 loan to a purchaser of the property for all or part of the purchase
10-2 price of the real estate against which the mortgage is secured; or
10-3 (4) an individual who:
10-4 (A) makes a mortgage loan from the individual's
10-5 own funds;
10-6 (B) is not an authorized lender under Chapter
10-7 342, Finance Code; and
10-8 (C) does not regularly engage in the business of
10-9 making or brokering mortgage loans.
10-10 Sec. 156.203. APPLICATION FOR A LICENSE; FEES. (a) An
10-11 application for a mortgage broker or loan officer license must be:
10-12 (1) in writing;
10-13 (2) under oath; and
10-14 (3) on the form prescribed by the commissioner.
10-15 (b) An application for a mortgage broker license must be
10-16 accompanied by:
10-17 (1) an application fee in an amount determined by the
10-18 commissioner not to exceed $375; and
10-19 (2) a recovery fund fee as provided by Section
10-20 156.502.
10-21 (c) An application for a loan officer license must be
10-22 accompanied by:
10-23 (1) an application fee in an amount determined by the
10-24 commissioner not to exceed $175; and
10-25 (2) a recovery fund fee as provided by Section
10-26 156.502.
10-27 (d) An application fee under this section is not refundable.
11-1 Sec. 156.204. QUALIFICATIONS. (a) To be eligible to be
11-2 licensed as a mortgage broker a person must:
11-3 (1) be an individual who is at least 18 years of age;
11-4 (2) be a citizen of the United States or a lawfully
11-5 admitted alien;
11-6 (3) maintain a physical office in this state and
11-7 designate that office in the application;
11-8 (4) provide the commissioner with satisfactory
11-9 evidence that the applicant satisfies one of the following:
11-10 (A) the person has received a bachelor's degree
11-11 in an area relating to finance, banking, or business administration
11-12 from an accredited college or university and has 18 months of
11-13 experience in the mortgage or lending field as evidenced by
11-14 documentary proof of full-time employment as a mortgage broker or
11-15 loan officer with a mortgage broker or a person exempt under
11-16 Section 156.202;
11-17 (B) the person is licensed in this state as:
11-18 (i) an active real estate broker under The
11-19 Real Estate License Act (Article 6573a, Vernon's Texas Civil
11-20 Statutes); or
11-21 (ii) an active attorney; or
11-22 (C) the person has three years of experience in
11-23 the mortgage lending field as evidenced by documentary proof of
11-24 full-time employment as a loan officer with a mortgage broker or a
11-25 person exempt under Section 156.202;
11-26 (5) demonstrate evidence of compliance with the
11-27 financial requirements of this chapter; and
12-1 (6) not have been convicted of a criminal offense that
12-2 the commissioner determines directly relates to the occupation of a
12-3 mortgage broker under Article 6252-13c, Revised Statutes.
12-4 (b) A mortgage broker may conduct business under a corporate
12-5 structure, partnership, or any other business form or as an
12-6 independent contractor for a corporation, partnership, or any other
12-7 business entity. Before conducting mortgage broker activities
12-8 under, through, or for a corporation, partnership, or other
12-9 business entity, a mortgage broker must notify the commissioner, in
12-10 writing, of any corporate name, partnership name, assumed name, or
12-11 any other name under, through, or for which the mortgage broker
12-12 conducts activities for which a license is required under this
12-13 chapter. The corporation, partnership, or other business entity
12-14 under, through, or for which the mortgage broker conducts business
12-15 is not required to be separately licensed as a mortgage broker
12-16 provided that all individuals who perform mortgage broker
12-17 activities are licensed as mortgage brokers or loan officers. The
12-18 commissioner shall require proof of compliance with this subsection
12-19 at the time the mortgage broker applies for and renews a license.
12-20 (c) To be eligible to be licensed as a loan officer a person
12-21 must:
12-22 (1) be an individual who is at least 18 years of age;
12-23 (2) be a citizen of the United States or a lawfully
12-24 admitted alien;
12-25 (3) designate in the application the name of the
12-26 mortgage broker sponsoring the loan officer;
12-27 (4) provide the commissioner with satisfactory
13-1 evidence that the applicant satisfies one of the following:
13-2 (A) the person meets one of the requirements
13-3 described by Subsection (a)(4);
13-4 (B) the person has successfully completed 15
13-5 hours of education courses approved by the commissioner under this
13-6 section;
13-7 (C) the person has 18 months of experience as a
13-8 loan officer as evidenced by documentary proof of full-time
13-9 employment as a loan officer with a mortgage broker or a person
13-10 exempt under Section 156.202; or
13-11 (D) for applications received prior to January
13-12 1, 2000, the mortgage broker that will sponsor the applicant
13-13 provides a certification under oath that the applicant has been
13-14 provided necessary and appropriate education and training regarding
13-15 all applicable state and federal law and regulations relating to
13-16 mortgage loans; and
13-17 (5) not have been convicted of a criminal offense that
13-18 the commissioner determines directly relates to the occupation of a
13-19 loan officer under Article 6252-13c, Revised Statutes.
13-20 Sec. 156.205. FINANCIAL REQUIREMENTS FOR A MORTGAGE BROKER.
13-21 (a) In this section, "net assets" means the difference between
13-22 total assets and total liabilities, as determined by generally
13-23 acceptable accounting principles.
13-24 (b) A mortgage broker must maintain net assets of at least
13-25 $25,000 or a surety bond in the amount of at least $50,000. The
13-26 term of the surety bond must coincide with the term of the license.
13-27 (c) The commissioner shall require proof of compliance with
14-1 this section at the time the mortgage broker applies for or renews
14-2 a license.
14-3 Sec. 156.206. CRIMINAL BACKGROUND CHECK. (a) On receipt of
14-4 an application for a mortgage broker license or a loan officer
14-5 license, the commissioner shall conduct a criminal background check
14-6 of the applicant.
14-7 (b) The commissioner shall obtain criminal history record
14-8 information on an applicant that is maintained by the Department of
14-9 Public Safety. By rule, the commissioner may require applicants to
14-10 submit information and fingerprints necessary for the commissioner
14-11 to obtain criminal background information from the Federal Bureau
14-12 of Investigation. The commissioner may also obtain criminal
14-13 history record information from any court or any local, state, or
14-14 national governmental agency.
14-15 (c) The commissioner shall keep confidential any criminal
14-16 background information obtained under this subsection and may not
14-17 release or disclose the information unless:
14-18 (1) the information is a public record at the time the
14-19 commissioner obtains the information; or
14-20 (2) the commissioner releases the information:
14-21 (A) under order from a court;
14-22 (B) with the permission of the applicant;
14-23 (C) to a person through whom the applicant is
14-24 conducting or will conduct business; or
14-25 (D) to a governmental agency.
14-26 Sec. 156.207. ISSUANCE OF LICENSE CERTIFICATE; PROVISIONAL
14-27 LICENSE. (a) The commissioner shall issue a license certificate
15-1 to an applicant for a mortgage broker license if the commissioner
15-2 finds that the applicant meets all requirements and conditions for
15-3 the license.
15-4 (b) When an applicant for a loan officer license has met all
15-5 requirements and conditions for the license, the commissioner shall
15-6 issue a license certificate to the mortgage broker sponsoring the
15-7 loan officer.
15-8 (c) In accordance with any rules adopted under this
15-9 subsection, the commissioner may issue a provisional license to an
15-10 applicant if a significant delay is necessary to process the
15-11 application, review information related to the application, or
15-12 obtain information related to the application. The commissioner
15-13 may revoke a provisional license issued under this subsection on a
15-14 ground listed under Section 156.303 or on any ground that the
15-15 commissioner could have denied issuance of the license on the
15-16 application.
15-17 Sec. 156.208. RENEWALS. (a) A mortgage broker license
15-18 issued under this chapter is valid for two years and may be renewed
15-19 on or before its expiration date if the mortgage broker:
15-20 (1) pays to the commissioner a renewal fee in an
15-21 amount determined by the commissioner not to exceed $375 and a
15-22 recovery fund fee provided by Section 156.502;
15-23 (2) has not been convicted of a felony the
15-24 commissioner determines is directly related to the occupation of a
15-25 mortgage broker under Article 6252-13c, Revised Statutes; and
15-26 (3) provides the commissioner with satisfactory
15-27 evidence that the mortgage broker:
16-1 (A) has attended, during the term of the current
16-2 license, 15 hours of continuing education courses that the
16-3 commissioner, in accordance with the rules adopted under this
16-4 section, has approved as continuing education courses; or
16-5 (B) maintains an active license in this state as
16-6 a real estate broker, real estate salesperson, or attorney.
16-7 (b) A loan officer license issued under this chapter is
16-8 valid for two years and may be renewed on or before its expiration
16-9 date if the loan officer:
16-10 (1) pays to the commissioner a renewal fee in an
16-11 amount determined by the commissioner not to exceed $175 and a
16-12 recovery fund fee provided by Section 156.502;
16-13 (2) has not been convicted of a felony the
16-14 commissioner determines is directly related to the occupation of a
16-15 loan officer under Article 6252-13c, Revised Statutes; and
16-16 (3) provides the commissioner with satisfactory
16-17 evidence that the loan officer:
16-18 (A) has attended, during the term of the current
16-19 license, 15 hours of continuing education courses that the
16-20 commissioner, in accordance with the rules adopted under this
16-21 section, has approved as continuing education courses, including
16-22 courses provided by or through the licensed mortgage broker with
16-23 whom the loan officer is associated after submission to and
16-24 approval by the commission; or
16-25 (B) maintains an active license in this state as
16-26 a real estate broker, real estate salesperson, or attorney.
16-27 (c) The commissioner may require mortgage brokers or loan
17-1 officers to submit requests for renewal on a form prescribed by the
17-2 commissioner.
17-3 (d) On receipt of a request for a renewal of a license
17-4 issued under this subchapter, the commissioner may conduct a
17-5 criminal background check under Section 156.206.
17-6 (e) A renewal fee is not refundable.
17-7 (f) The commissioner by rule may adopt a system under which
17-8 licenses expire on a date or dates other than December 31. If a
17-9 system is adopted under this subsection, dates relating to
17-10 expiration and issuance of licenses shall be adjusted accordingly.
17-11 For the biennium in which the license expiration date is changed,
17-12 license fees shall be prorated on a monthly basis so that each
17-13 license holder pays only that portion of the license fee that is
17-14 allocable to the number of months during which the license is
17-15 valid. On renewal of the license on the new expiration date, the
17-16 total license renewal fee is payable.
17-17 (g) The commissioner shall adopt rules related to the
17-18 approval of courses for continuing education credit under this
17-19 section that provide for the acceptance of continuing education
17-20 courses that are related to finance, financial consulting, lending,
17-21 real estate contracts, discrimination laws, deceptive trade
17-22 practices, real property conveyances, and other topics that are
17-23 relevant to mortgage brokers and that are acceptable as continuing
17-24 education courses to other professional licensing agencies.
17-25 Sec. 156.209. DENIAL OF APPLICATIONS AND RENEWALS. (a) If
17-26 the commissioner declines or fails to issue or renew a license, the
17-27 commissioner shall promptly give written notice to the applicant or
18-1 the person requesting the renewal that the application or renewal,
18-2 as appropriate, was denied.
18-3 (b) Before the applicant or person requesting the renewal
18-4 may appeal to a district court as provided by Section 156.401, the
18-5 applicant or person must file with the commissioner, not later than
18-6 the 10th day after the date on which notice under Subsection (a) is
18-7 received, an appeal of the ruling requesting a time and place for a
18-8 hearing before a hearings officer designated by the commissioner.
18-9 (c) The designated hearings officer shall set the time and
18-10 place for a hearing requested under Subsection (b) not later than
18-11 the 30th day after the date on which the appeal is received. The
18-12 hearings officer shall provide at least 10 days' notice of the
18-13 hearing to the applicant or person requesting the renewal. The
18-14 time of the hearing may be continued periodically with the consent
18-15 of the applicant or person requesting the renewal. After the
18-16 hearing, the commissioner shall enter an order from the findings of
18-17 fact, conclusions of law, and recommendations of the hearings
18-18 officer.
18-19 (d) If an applicant or person requesting the renewal fails
18-20 to request a hearing under this section, the commissioner's refusal
18-21 to issue or renew a license is final and may not be subject to
18-22 review by the courts.
18-23 (e) A hearing held under this section is governed by Chapter
18-24 2001, Government Code. An appeal of a final order issued under
18-25 this section may be made in accordance with Section 156.401.
18-26 Sec. 156.210. PROBATIONARY LICENSE. The commissioner may
18-27 issue a probationary license. The commissioner by rule shall adopt
19-1 reasonable terms and conditions for a probationary license.
19-2 Sec. 156.211. CHANGE OF ADDRESS OR SPONSORSHIP; MODIFICATION
19-3 OF LICENSE. (a) Before the 10th day preceding the effective date
19-4 of an address change, a mortgage broker shall notify the
19-5 commissioner in writing of the new address accompanied by a change
19-6 of address fee of $25. A new license certificate must be obtained
19-7 before the mortgage broker may conduct business at the new
19-8 location.
19-9 (b) A loan officer may act only for the mortgage broker
19-10 sponsoring the loan officer. A loan officer may be sponsored by
19-11 only one mortgage broker at a time. When the sponsorship of a loan
19-12 officer is terminated, the loan officer and the mortgage broker
19-13 shall immediately notify the commissioner and the mortgage broker
19-14 shall return the loan officer license to the commissioner. The
19-15 loan officer's license then becomes inactive. The loan officer
19-16 license may be activated if, before the license expires, a mortgage
19-17 broker files a request, accompanied by a $25 fee, notifying the
19-18 commissioner that the mortgage broker will sponsor the loan officer
19-19 and will assume responsibility for the actions of the loan officer.
19-20 (c) A fee under this section is not refundable.
19-21 Sec. 156.212. MAINTENANCE AND LOCATION OF OFFICES; DISPLAY
19-22 OF LICENSE CERTIFICATES. (a) Each mortgage broker licensed under
19-23 this chapter shall maintain a physical office in this state. The
19-24 address of the office shall be designated on the license
19-25 certificate.
19-26 (b) If a mortgage broker maintains more than one place of
19-27 business in this state, the mortgage broker shall apply for, pay a
20-1 fee of $50 for, and obtain an additional license certificate to be
20-2 known as a branch office license for each additional office to be
20-3 maintained by the mortgage broker.
20-4 (c) The license certificate of a mortgage broker shall be at
20-5 all times prominently displayed in the mortgage broker's place of
20-6 business. The branch office certificate shall be at all times
20-7 prominently displayed in the mortgage broker's branch office.
20-8 (d) A loan officer license certificate shall be at all times
20-9 prominently displayed in the office of the mortgage broker for whom
20-10 the loan officer primarily conducts business.
20-11 (Sections 156.213 to 156.300 reserved for expansion
20-12 SUBCHAPTER D. LICENSE REVOCATION AND SUSPENSION AND OTHER ACTIONS
20-13 AGAINST LICENSE HOLDER
20-14 Sec. 156.301. COMPLAINTS AND INVESTIGATIONS. (a) On the
20-15 signed written complaint of a person, the commissioner shall
20-16 investigate the actions and records of a person licensed under this
20-17 chapter if the complaint, or the complaint and documentary or other
20-18 evidence presented in connection with the complaint, provides
20-19 reasonable cause. The commissioner, before commencing an
20-20 investigation, shall notify a mortgage broker or loan officer in
20-21 writing of the complaint and that the commissioner intends to
20-22 investigate the matter.
20-23 (b) Except as provided by Subsection (a), the commissioner
20-24 may not initiate an investigation or other action against a person
20-25 licensed under this chapter on the basis of an anonymous complaint
20-26 regardless of whether the complaint is in writing. The
20-27 commissioner may conduct an undercover or covert investigation only
21-1 if the commissioner, after due consideration of the circumstances,
21-2 determines that the investigation is necessary to prevent immediate
21-3 harm and to carry out the purposes of this chapter.
21-4 (c) The commissioner may authorize an employee of the
21-5 commissioner to file a signed written complaint against a person
21-6 licensed under this chapter and to conduct an investigation if:
21-7 (1) a judgment against the person has been paid from a
21-8 recovery fund established under this chapter;
21-9 (2) the person holds a provisional license issued
21-10 under Section 156.207(c);
21-11 (3) the person is convicted of a criminal offense that
21-12 may constitute grounds for the suspension or revocation of the
21-13 license; or
21-14 (4) the person fails to honor a check issued to the
21-15 commissioner.
21-16 Sec. 156.302. ADMINISTRATIVE PENALTY. (a) The commissioner
21-17 may impose an administrative penalty on a person licensed under
21-18 this chapter who violates this chapter or a rule or order adopted
21-19 under this chapter.
21-20 (b) The amount of the penalty may not exceed $2,500, and
21-21 each day a violation continues or occurs is a separate violation
21-22 for the purpose of imposing a penalty. The amount shall be based
21-23 on:
21-24 (1) the seriousness of the violation, including the
21-25 nature, circumstances, extent, and gravity of the violation;
21-26 (2) the history of previous violations;
21-27 (3) the amount necessary to deter a future violation;
22-1 (4) efforts to correct the violation; and
22-2 (5) any other matter that justice may require.
22-3 (c) The enforcement of the penalty may be stayed during the
22-4 time the order is under judicial review if the person pays the
22-5 penalty to the clerk of the court or files a supersedeas bond with
22-6 the court in the amount of the penalty. A person who cannot afford
22-7 to pay the penalty or file the bond may stay the enforcement by
22-8 filing an affidavit in the manner required by the Texas Rules of
22-9 Civil Procedure for a party who cannot afford to file security for
22-10 costs, subject to the right of the commissioner to contest the
22-11 affidavit as provided by those rules.
22-12 (d) The attorney general may sue to collect the penalty.
22-13 (e) A proceeding to impose the penalty is considered to be a
22-14 contested case under Chapter 2001, Government Code.
22-15 Sec. 156.303. DISCIPLINARY ACTION; CEASE AND DESIST ORDER.
22-16 (a) The commissioner may order disciplinary action against a
22-17 licensed mortgage broker or a licensed loan officer when the
22-18 commissioner, after a hearing, has determined that the person:
22-19 (1) obtained a license under this chapter through a
22-20 false or fraudulent representation or made a material
22-21 misrepresentation in an application for a license under this
22-22 chapter;
22-23 (2) published or caused to be published an
22-24 advertisement related to the business of a mortgage broker or loan
22-25 officer that:
22-26 (A) is misleading;
22-27 (B) is likely to deceive the public;
23-1 (C) in any manner tends to create a misleading
23-2 impression;
23-3 (D) fails to identify as a mortgage broker or
23-4 loan officer the person causing the advertisement to be published;
23-5 or
23-6 (E) violates federal or state law;
23-7 (3) while performing an act for which a license under
23-8 this chapter is required, engaged in conduct that constitutes
23-9 improper, fraudulent, or dishonest dealings;
23-10 (4) failed to notify the commissioner not later than
23-11 the 30th day after the date of the final conviction if the person,
23-12 in a court of this or another state or in a federal court, has been
23-13 convicted of or entered a plea of guilty or nolo contendere to a
23-14 felony or a criminal offense involving fraud;
23-15 (5) failed to use a fee collected in advance of
23-16 closing of a mortgage loan for a purpose for which the fee was
23-17 paid;
23-18 (6) charged or received, directly or indirectly, a fee
23-19 for assisting a mortgage applicant in obtaining a mortgage loan
23-20 before all of the services that the person agreed to perform for
23-21 the mortgage applicant are completed, and the proceeds of the
23-22 mortgage loan have been disbursed to or on behalf of the mortgage
23-23 applicant, except as provided by Section 156.304;
23-24 (7) failed within a reasonable time to honor a check
23-25 issued to the commissioner after the commissioner has mailed a
23-26 request for payment by certified mail to the person's last known
23-27 business address as reflected by the commissioner's records;
24-1 (8) paid compensation to a person who is not licensed
24-2 or exempt under this chapter for acts for which a license under
24-3 this chapter is required;
24-4 (9) induced or attempted to induce a party to a
24-5 contract to breach the contract so the person may make a mortgage
24-6 loan;
24-7 (10) published or circulated an unjustified or
24-8 unwarranted threat of legal proceedings in matters related to the
24-9 person's actions or services as a mortgage broker or loan officer,
24-10 as applicable;
24-11 (11) established an association, by employment or
24-12 otherwise, with a person not licensed or exempt under this chapter
24-13 who was expected or required to act as a mortgage broker or loan
24-14 officer;
24-15 (12) aided, abetted, or conspired with a person to
24-16 circumvent the requirements of this chapter;
24-17 (13) acted in the dual capacity of a mortgage broker
24-18 or loan officer and real estate broker, salesperson, or attorney
24-19 in a transaction without the knowledge and written consent of the
24-20 mortgage applicant or in violation of applicable requirements under
24-21 federal law;
24-22 (14) discriminated against a prospective borrower on
24-23 the basis of race, color, religion, sex, national origin, ancestry,
24-24 familial status, or a disability;
24-25 (15) failed or refused on demand to:
24-26 (A) produce a document, book, or record
24-27 concerning a mortgage loan transaction conducted by the mortgage
25-1 broker or loan officer for inspection by the commissioner or the
25-2 commissioner's authorized personnel or representative;
25-3 (B) give the commissioner or the commissioner's
25-4 authorized personnel or representative free access to the books or
25-5 records relating to the person's business kept by an officer,
25-6 agent, or employee of the person or any business entity through
25-7 which the person conducts mortgage brokerage activities, including
25-8 a subsidiary or holding company affiliate; or
25-9 (C) provide information requested by the
25-10 commissioner as a result of a formal or informal complaint made to
25-11 the commissioner;
25-12 (16) failed without just cause to surrender, on
25-13 demand, a copy of a document or other instrument coming into the
25-14 person's possession that was provided to the person by another
25-15 person making the demand or that the person making the demand is
25-16 under law entitled to receive; or
25-17 (17) disregarded or violated this chapter or a rule
25-18 adopted by the commissioner under this chapter.
25-19 (b) In addition to disciplinary action by the commissioner
25-20 authorized under Subsection (a), the commissioner, if the
25-21 commissioner has reasonable cause to believe that a person licensed
25-22 under this chapter has or is about to violate this section, may
25-23 issue without notice and hearing an order to cease and desist from
25-24 continuing a particular action or an order to take affirmative
25-25 action, or both, to enforce compliance with this chapter.
25-26 (c) An order issued under Subsection (b) must contain a
25-27 reasonably detailed statement of the facts on which the order is
26-1 made. If a person against whom the order is made requests a
26-2 hearing, the commissioner shall set and give notice of a hearing
26-3 before the commissioner or a hearings officer. The hearing shall
26-4 be governed by Chapter 2001, Government Code. Based on the
26-5 findings of fact, conclusions of law, and recommendations of the
26-6 hearings officer, the commissioner by order may find a violation
26-7 has occurred or not occurred.
26-8 (d) If a hearing is not requested under Subsection (c) not
26-9 later than the 30th day after the date on which an order is made,
26-10 the order is considered final and not appealable.
26-11 (e) The commissioner, after giving notice, may impose
26-12 against a person who violates a cease and desist order an
26-13 administrative penalty in an amount not to exceed $1,000 for each
26-14 day of the violation. In addition to any other remedy provided by
26-15 law, the commissioner may institute in district court a suit for
26-16 injunctive relief and to collect the administrative penalty. A
26-17 bond is not required of the commissioner with respect to injunctive
26-18 relief granted under this subsection. A penalty collected under
26-19 this subsection shall be deposited in the fund.
26-20 Sec. 156.304. FEE ASSESSMENT AND DISCLOSURE. (a) Before
26-21 the completion of all services to be performed, a mortgage broker
26-22 may charge and receive, unless prohibited by law, the following
26-23 fees for services in assisting a mortgage applicant to obtain a
26-24 mortgage:
26-25 (1) a fee to obtain a credit report;
26-26 (2) a fee for the appraisal of the real estate;
26-27 (3) a fee for processing a mortgage application;
27-1 (4) a fee for taking a mortgage application;
27-2 (5) a fee for automated underwriting;
27-3 (6) a fee for a courier service;
27-4 (7) a fee to issue a loan commitment; or
27-5 (8) subject to Subsection (b), a fee for locking in an
27-6 interest rate.
27-7 (b) A mortgage broker or loan officer may not charge or
27-8 receive a fee for locking in an interest rate unless there is a
27-9 written agreement signed by the mortgage applicant and mortgage
27-10 broker that contains a statement of whether the fee to lock in the
27-11 interest rate is refundable and, if so, the terms and conditions
27-12 necessary to obtain the refund.
27-13 (Sections 156.305 to 156.400 reserved for expansion
27-14 SUBCHAPTER E. HEARINGS; JUDICIAL REVIEW; CIVIL ACTIONS; UNLICENSED
27-15 ACTIVITY
27-16 Sec. 156.401. HEARINGS AND JUDICIAL REVIEW. (a) The
27-17 commissioner may employ an enforcement staff to investigate and
27-18 prosecute complaints made against persons licensed under this
27-19 chapter. The commissioner may employ a hearings officer to conduct
27-20 hearings under this section.
27-21 (b) If the commissioner proposes to suspend or revoke a
27-22 license issued under this chapter or if the commissioner refuses to
27-23 issue or renew a license to an applicant for a license or person
27-24 requesting a renewal of a license under this chapter, the applicant
27-25 or license holder is entitled to a hearing before the commissioner
27-26 or a hearings officer who shall make a proposal for decision to the
27-27 commissioner. The commissioner or hearings officer shall prescribe
28-1 the time and place of the hearing. The hearing is governed by
28-2 Chapter 2001, Government Code.
28-3 (c) The commissioner or hearings officer may issue subpoenas
28-4 for the attendance of witnesses and the production of records or
28-5 documents. Process issued by the commissioner or hearings officer
28-6 may extend to all parts of the state and may be served by any
28-7 person designated by the commissioner or hearings officer.
28-8 (d) An individual aggrieved by a ruling, order, or decision
28-9 of the commissioner has the right to appeal to a district court in
28-10 the county in which the hearing was held. An appeal under this
28-11 subsection is governed by Chapter 2001, Government Code.
28-12 Sec. 156.402. CIVIL ACTIONS AND INJUNCTIVE RELIEF. (a) A
28-13 mortgage applicant injured by a violation of this chapter may bring
28-14 an action for recovery of actual monetary damages and reasonable
28-15 attorney's fees and court costs.
28-16 (b) The commissioner, the attorney general, or a mortgage
28-17 applicant may bring an action to enjoin a violation of this
28-18 chapter.
28-19 (c) A remedy provided by this section is in addition to any
28-20 other remedy provided by law.
28-21 Sec. 156.403. BURDEN OF PROOF TO ESTABLISH AN EXEMPTION.
28-22 The burden of proving an exemption in a proceeding or action
28-23 brought under this chapter is on the person claiming the benefit of
28-24 the exemption.
28-25 Sec. 156.404. RELIANCE ON WRITTEN NOTICES FROM COMMISSIONER.
28-26 A person does not violate this chapter with respect to an action
28-27 taken or omission made in reliance on a written notice, written
29-1 interpretation, or written report from the commissioner, unless a
29-2 subsequent amendment to this chapter or a rule adopted under this
29-3 chapter affects the commissioner's notice, interpretation, or
29-4 report.
29-5 Sec. 156.405. COMPLETION OF MORTGAGE BROKER SERVICES.
29-6 (a) On disbursement of mortgage proceeds to or on behalf of the
29-7 mortgage applicant, the mortgage broker and loan officer who
29-8 assisted the mortgage applicant in obtaining the mortgage loan are
29-9 considered to have completed the performance of the mortgage
29-10 broker's and loan officer's services for the mortgage applicant and
29-11 owe no additional duties or obligations to the mortgage applicant
29-12 with respect to the mortgage loan.
29-13 (b) This section does not limit or preclude the liability of
29-14 a mortgage broker or loan officer for:
29-15 (1) failing to comply with this chapter or a rule
29-16 adopted under this chapter;
29-17 (2) failing to comply with a provision of or duty
29-18 arising under an agreement with a mortgage applicant or lender
29-19 under this chapter; or
29-20 (3) violating any other state or federal law.
29-21 Sec. 156.406. UNLICENSED ACTIVITY. (a) A person who is not
29-22 exempt under this chapter and who acts as a mortgage broker or loan
29-23 officer without first obtaining a license required under this
29-24 chapter commits an offense. An offense under this subsection is a
29-25 Class B misdemeanor. A second or subsequent conviction for an
29-26 offense under this subsection shall be punished as a Class A
29-27 misdemeanor.
30-1 (b) A person who received money, or the equivalent of money,
30-2 as a fee or profit because of or in consequence of the person
30-3 acting as a mortgage broker or loan officer without an active
30-4 license or being exempt under this chapter is liable for damages in
30-5 an amount that is not less than the amount of the fee or profit
30-6 received and not to exceed three times the amount of the fee or
30-7 profit received, as may be determined by the court. An aggrieved
30-8 person may recover damages under this subsection in a court.
30-9 (c) If the commissioner has reasonable cause to believe that
30-10 a person who is not licensed or exempt under this chapter has
30-11 engaged, or is about to engage, in an act or practice for which a
30-12 license is required under this chapter, the commissioner may issue
30-13 without notice and hearing an order to cease and desist from
30-14 continuing a particular action or an order to take affirmative
30-15 action, or both, to enforce compliance with this chapter. The
30-16 order shall contain a reasonably detailed statement of the facts on
30-17 which the order is made. If a person against whom the order is
30-18 made requests a hearing, the commissioner shall set and give notice
30-19 of a hearing before the commissioner or a hearings officer. The
30-20 hearing shall be governed by Chapter 2001, Government Code. Based
30-21 on the findings of fact, conclusions of law, and recommendations of
30-22 the hearings officer, the commissioner by order may find a
30-23 violation has occurred or not occurred.
30-24 (d) If a hearing has not been requested under Subsection (c)
30-25 not later than the 30th day after the date the order is made, the
30-26 order is considered final and not appealable. The commissioner,
30-27 after giving notice, may impose against a person who violates a
31-1 cease and desist order, an administrative penalty in an amount not
31-2 to exceed $1,000 for each day of a violation. In addition to any
31-3 other remedy provided by law, the commissioner may institute in
31-4 district court a suit for injunctive relief and to collect the
31-5 administrative penalty. A bond is not required of the commissioner
31-6 with respect to injunctive relief granted under this section. A
31-7 penalty collected under this subsection shall be deposited in the
31-8 fund.
31-9 (Sections 156.407 to 156.500 reserved for expansion
31-10 SUBCHAPTER F. MORTGAGE BROKER RECOVERY FUND
31-11 Sec. 156.501. MORTGAGE BROKER RECOVERY FUND. (a) The
31-12 commissioner shall establish and maintain a mortgage broker
31-13 recovery fund as provided by this subchapter. The amounts received
31-14 by the commissioner for deposit in the fund shall be held by the
31-15 commissioner in trust for carrying out the purposes of the fund.
31-16 (b) The fund shall be used to reimburse aggrieved persons to
31-17 whom a court awards actual damages because of certain acts
31-18 committed by a mortgage broker or loan officer who was licensed
31-19 under this chapter when the act was committed. The use of the fund
31-20 is limited to an act that constitutes a violation of Section
31-21 156.303(a)(2), (3), (5), (6), (8), (9), (10), (11), (12), (13), or
31-22 (16) or 156.304.
31-23 (c) Amounts in the fund may be invested and reinvested in
31-24 the same manner as funds of the Texas State Employees Retirement
31-25 System, and the interest from these investments shall be deposited
31-26 to the credit of the fund. An investment may not be made under
31-27 this subsection if the investment will impair the necessary
32-1 liquidity required to satisfy judgment payments awarded under this
32-2 subchapter.
32-3 Sec. 156.502. FUNDING. (a) On an application for an
32-4 original license or for renewal of a license issued under this
32-5 chapter, the applicant, in addition to paying the original
32-6 application fee or renewal fee, shall pay a $20 fee. The fee shall
32-7 be deposited in the fund.
32-8 (b) If the balance remaining in the fund at the end of a
32-9 calendar year after 2010 is less than $500,000, each mortgage
32-10 broker and loan officer licensed under this chapter, on the next
32-11 renewal of the license, shall pay, in addition to any other
32-12 required fees, the lesser of a $10 fee or a pro rata share of the
32-13 amount necessary to bring the fund to $1 million. The fee shall be
32-14 deposited in the fund.
32-15 (c) If the balance remaining in the mortgage broker recovery
32-16 fund at the end of a calendar year is more than the greater of $3.5
32-17 million or the total amount of claims paid from the fund during the
32-18 previous four fiscal years, the amount of money in excess of the
32-19 greater amount shall be transferred to the general revenue fund.
32-20 Sec. 156.503. STATUTE OF LIMITATIONS. An action for a
32-21 judgment that subsequently results in an order for collection from
32-22 the fund may not be instituted after the second anniversary of the
32-23 date on which the cause of action accrues.
32-24 Sec. 156.504. PROCEDURE FOR RECOVERY. (a) An aggrieved
32-25 person who recovers against a mortgage broker or loan officer
32-26 licensed under this chapter a valid court judgment for conduct
32-27 described by Section 156.501 that occurred on or after January 1,
33-1 2000, after final judgment has been entered, execution returned
33-2 nulla bona, and a judgment lien perfected, may file a verified
33-3 claim in the court in which the judgment was entered and, on 20
33-4 days' written notice to the commissioner and to the judgment
33-5 debtor, may apply to the court for an order directing payment from
33-6 the fund of any unpaid judgment amount, subject to Section 156.503.
33-7 (b) On the hearing on the application, the aggrieved person
33-8 is required to show:
33-9 (1) that the judgment is based on facts allowing
33-10 recovery under Section 156.501;
33-11 (2) that the person is not a spouse of the debtor, or
33-12 the personal representative of the spouse, and that the person is
33-13 not licensed as a mortgage broker or loan officer under this
33-14 chapter who is seeking to recover any compensation in the
33-15 transaction or transactions for which the application for payment
33-16 is made;
33-17 (3) that based on the best available information, the
33-18 judgment debtor lacks sufficient attachable assets in this state or
33-19 any other state to satisfy the judgment and the surety bond
33-20 required by Section 156.205 is not sufficient to satisfy the
33-21 judgment; and
33-22 (4) the amount that may be realized from the sale of
33-23 property or other assets liable to be sold or applied in
33-24 satisfaction of the judgment and the balance remaining due on the
33-25 judgment after application of the amount that may be realized.
33-26 (c) A recovery on the judgment against a single defendant
33-27 made before payment from the fund shall be applied first by the
34-1 creditor to actual damages.
34-2 (d) The court shall make an order directed to the
34-3 commissioner requiring payment from the fund of the amount the
34-4 court finds to be payable on the claim, pursuant to and in
34-5 accordance with the limitations contained in this subchapter, if
34-6 the court is satisfied, on the hearing, of the truth of all matters
34-7 required to be shown by the aggrieved person under Subsection (b)
34-8 and that the aggrieved person has satisfied all of the requirements
34-9 of this section.
34-10 (e) When the commissioner receives notice of entry of a
34-11 final judgment and a hearing is scheduled under this section, the
34-12 commissioner may notify the attorney general of the commissioner's
34-13 desire to enter an appearance, file a response, appear at the court
34-14 hearing, defend the action, or to take any other appropriate
34-15 action. In taking any action described by this subsection, the
34-16 commissioner and the attorney general shall act only to protect the
34-17 fund from spurious or unjust claims or to ensure compliance with
34-18 the requirements for recovery under this subchapter.
34-19 (f) The commissioner may relitigate any issue material and
34-20 relevant in the hearing on the application that was determined in
34-21 the underlying action on which the judgment in favor of the
34-22 applicant was based.
34-23 (g) If the court finds that the aggregate amount of claims
34-24 against a licensed mortgage broker or loan officer exceeds the
34-25 limits contained in Section 156.505, the court shall reduce
34-26 proportionately the amount the court finds payable on the claim.
34-27 Sec. 156.505. RECOVERY LIMITS. (a) A person entitled to
35-1 receive payment out of the fund is entitled to receive
35-2 reimbursement of actual, out-of-pocket damages, reasonable
35-3 attorney's fees, and court costs as determined by the court as
35-4 provided by this section.
35-5 (b) A payment from the fund may be made only pursuant to a
35-6 court order as provided by Section 156.504. A payment for claims:
35-7 (1) arising out of the same transaction, including
35-8 attorney's fees, interest, and court costs, is limited in the
35-9 aggregate to $25,000, regardless of the number of claimants; and
35-10 (2) based on judgments against a single person
35-11 licensed as a mortgage broker or loan officer under this chapter is
35-12 limited in the aggregate to $50,000 until the fund has been
35-13 reimbursed for all amounts paid.
35-14 Sec. 156.506. REVOCATION OF LICENSE FOR PAYMENT FROM FUND.
35-15 (a) The commissioner may revoke a license issued under this
35-16 chapter on proof that the commissioner has made a payment from the
35-17 fund of any amount toward satisfaction of a judgment against a
35-18 person licensed as a mortgage broker or loan officer under this
35-19 chapter.
35-20 (b) The commissioner may probate an order revoking a license
35-21 under this section.
35-22 (c) A person on whose behalf payment was made from the fund
35-23 is not eligible to receive a new license under this chapter until
35-24 the person has repaid in full, plus interest at the current legal
35-25 rate, the amount paid from the fund on the person's behalf.
35-26 (d) This section does not limit the authority of the
35-27 commissioner to take disciplinary action against a mortgage broker
36-1 or loan officer for a violation of this chapter or the rules
36-2 adopted by the commissioner under this chapter. The repayment in
36-3 full to the fund of all obligations of a mortgage broker or loan
36-4 officer does not nullify or modify the effect of any other
36-5 disciplinary proceeding brought under this chapter.
36-6 Sec. 156.507. SUBROGATION. When the commissioner has paid a
36-7 judgment creditor an amount from the fund as directed by the court,
36-8 the commissioner is subrogated to all of the rights of the judgment
36-9 creditor to the extent of the amount paid. The judgment creditor
36-10 shall assign all of the creditor's right, title, and interest in
36-11 the judgment up to the amount paid by the commissioner, and that
36-12 amount has priority for repayment in the event of any subsequent
36-13 recovery on the judgment. Any amount, including interest,
36-14 recovered by the commissioner on the judgment shall be deposited to
36-15 the credit of the fund.
36-16 Sec. 156.508. FAILURE TO COMPLY WITH SUBCHAPTER. The
36-17 failure of an aggrieved person to comply with a provision of this
36-18 subchapter relating to the fund constitutes a waiver of any rights
36-19 under this subchapter.
36-20 SECTION 3. Subsection (a), Section 393.002, Finance Code, is
36-21 amended to read as follows:
36-22 (a) This chapter does not apply to:
36-23 (1) a person:
36-24 (A) authorized to make a loan or grant an
36-25 extension of consumer credit under the laws of this state or the
36-26 United States; and
36-27 (B) subject to regulation and supervision by
37-1 this state or the United States;
37-2 (2) a lender approved by the United States secretary
37-3 of housing and urban development for participation in a mortgage
37-4 insurance program under the National Housing Act (12 U.S.C. Section
37-5 1701 et seq.);
37-6 (3) a bank or savings and loan association the
37-7 deposits or accounts of which are eligible to be insured by the
37-8 Federal Deposit Insurance Corporation or a subsidiary of the bank
37-9 or association;
37-10 (4) a credit union doing business in this state;
37-11 (5) a nonprofit organization exempt from taxation
37-12 under Section 501(c)(3), Internal Revenue Code of 1986 (26 U.S.C.
37-13 Section 501(c)(3));
37-14 (6) a real estate broker or salesman licensed under
37-15 The Real Estate License Act (Article 6573a, Vernon's Texas Civil
37-16 Statutes) who is acting within the course and scope of that
37-17 license;
37-18 (7) an individual licensed to practice law in this
37-19 state who is acting within the course and scope of the individual's
37-20 practice as an attorney;
37-21 (8) a broker-dealer registered with the Securities and
37-22 Exchange Commission or the Commodity Futures Trading Commission
37-23 acting within the course and scope of that regulation;
37-24 (9) a consumer reporting agency; [or]
37-25 (10) a person whose primary business is making loans
37-26 secured by liens on real property; or
37-27 (11) a mortgage broker or loan officer licensed under
38-1 Chapter 156, Finance Code, who is acting within the course and
38-2 scope of that license.
38-3 SECTION 4. Section 232.002, Family Code, is amended to read
38-4 as follows:
38-5 Sec. 232.002. LICENSING AUTHORITIES SUBJECT TO CHAPTER. The
38-6 following [state agencies] are licensing authorities subject to
38-7 this chapter:
38-8 (1) Department of Agriculture;
38-9 (2) Texas Commission on Alcohol and Drug Abuse;
38-10 (3) Texas Alcoholic Beverage Commission;
38-11 (4) Texas Appraiser Licensing and Certification Board;
38-12 (5) Texas Board of Architectural Examiners;
38-13 (6) State Board of Barber Examiners;
38-14 (7) Texas Board of Chiropractic Examiners;
38-15 (8) Comptroller of Public Accounts;
38-16 (9) Texas Cosmetology Commission;
38-17 (10) Court Reporters Certification Board;
38-18 (11) State Board of Dental Examiners;
38-19 (12) Texas State Board of Examiners of Dietitians;
38-20 (13) Texas Funeral Service Commission;
38-21 (14) Texas Department of Health;
38-22 (15) Texas Department of Human Services;
38-23 (16) Texas Board of Professional Land Surveying;
38-24 (17) Texas Department of Licensing and Regulation;
38-25 (18) Texas State Board of Examiners of Marriage and
38-26 Family Therapists;
38-27 (19) Texas State Board of Medical Examiners;
39-1 (20) Midwifery Board;
39-2 (21) Texas Natural Resource Conservation Commission;
39-3 (22) Board of Nurse Examiners;
39-4 (23) Texas Board of Occupational Therapy Examiners;
39-5 (24) Texas Optometry Board;
39-6 (25) Parks and Wildlife Department;
39-7 (26) Texas State Board of Examiners of Perfusionists;
39-8 (27) Texas State Board of Pharmacy;
39-9 (28) Texas Board of Physical Therapy Examiners;
39-10 (29) Texas State Board of Plumbing Examiners;
39-11 (30) Texas State Board of Podiatric Medical Examiners;
39-12 (31) Polygraph Examiners Board;
39-13 (32) Texas Board of Private Investigators and Private
39-14 Security Agencies;
39-15 (33) Texas State Board of Examiners of Professional
39-16 Counselors;
39-17 (34) Texas [State] Board of [Registration for]
39-18 Professional Engineers;
39-19 (35) Department of Protective and Regulatory Services;
39-20 (36) Texas State Board of Examiners of Psychologists;
39-21 (37) Texas State Board of Public Accountancy;
39-22 (38) Department of Public Safety of the State of
39-23 Texas;
39-24 (39) Public Utility Commission of Texas;
39-25 (40) Railroad Commission of Texas;
39-26 (41) Texas Real Estate Commission;
39-27 (42) State Bar of Texas;
40-1 (43) Texas State Board of Social Worker Examiners;
40-2 (44) State Board of Examiners for Speech-Language
40-3 Pathology and Audiology;
40-4 (45) Texas Structural Pest Control Board;
40-5 (46) Board of Tax Professional Examiners;
40-6 (47) Secretary of State;
40-7 (48) Supreme Court of Texas;
40-8 (49) Texas Transportation Commission;
40-9 (50) State Board of Veterinary Medical Examiners;
40-10 (51) Board of Vocational Nurse Examiners;
40-11 (52) Texas Ethics Commission;
40-12 (53) Advisory Board of Athletic Trainers;
40-13 (54) State Committee of Examiners in the Fitting and
40-14 Dispensing of Hearing Instruments;
40-15 (55) Texas Board of Licensure for Professional Medical
40-16 Physicists;
40-17 (56) Texas Department of Insurance; [and]
40-18 (57) Texas Board of Orthotics and Prosthetics; and
40-19 (58) savings and loan commissioner.
40-20 SECTION 5. (a) This Act takes effect September 1, 1999.
40-21 (b) A person is not required to be licensed under Chapter
40-22 156, Finance Code, as added by this Act, before January 1, 2000.
40-23 SECTION 6. The importance of this legislation and the
40-24 crowded condition of the calendars in both houses create an
40-25 emergency and an imperative public necessity that the
40-26 constitutional rule requiring bills to be read on three several
40-27 days in each house be suspended, and this rule is hereby suspended.