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By: Flynn H.B. No. 2673
A BILL TO BE ENTITLED
AN ACT
relating to registration of certain mortgage bankers.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Title 3, Finance Code is amended by adding
Chapter 157 to read as follows:
CHAPTER 157. REGISTRATION OF MORTGAGE BANKERS
Sec. 157.001. SHORT TITLE. This chapter may be cited as the
Mortgage Banker Registration Act.
Sec. 157.002. DEFINITIONS. In this chapter:
(1) "Commissioner" means the savings and loan
commissioner.
(2) "Mortgage Banker" means a person who takes an
application for a mortgage loan or who makes a mortgage loan and who
is:
(A) approved or authorized by the United States
Department of Housing and Urban Development as a mortgagee with
direct endorsement underwriting authority;
(B) an approved seller or servicer of the Federal
National Mortgage Association;
(C) an approved seller or servicer of the Federal
Home Loan Mortgage Corporation; or
(D) an approved issuer for the Governmental
National Mortgage Association.
(3) "Mortgage Loan" means a debt against real estate
secured by a first-lien security interest against one-to-four
family residential real estate created by a deed of trust, security
deed, or other security instrument.
Sec. 157.003. REGISTRATION REQUIRED.
(A) Any person conducting the business of a
mortgage banker in this state must be registered under this chapter
unless exempt.
(B) Before conducting business in this state, a
mortgage banker shall register with the commissioner by filing a
statement that contains (1) the name and address of the
registrant, (2) the name, address, and telephone number of the
representative of the registrant to be contacted in the event of a
written complaint, and (3) a list of the business locations in
Texas of registrant's operations. Employees of a mortgage banker
are not required to register.
(C) The commissioner may not require the
registrant to provide information other than information contained
in the registration statement.
(D) The registration is valid until withdrawn or
canceled and periodic renewal is not required.
Section 157.004. EXEMPTIONS. This chapter does not apply
to a federally insured bank, savings bank, savings and loan
association, or credit union, or to an affiliate or subsidiary of a
federally insured bank, savings bank, savings and loan association,
or credit union, or to a person licensed in this state as a mortgage
broker under Chapter 156.
Section 157.005. UPDATE OF REGISTRATION STATEMENT. A
mortgage banker shall update information contained in the
registration statement not later than the 30th day after the date on
which the information changes.
Section 157.006. REGISTRATION FEE. The commissioner may
charge a mortgage banker a reasonable fee to cover the cost of
filing the registration statement and administering this Act in an
amount not to exceed $500 per year.
Section 157.007. DISCLOSURE STATEMENT. A mortgage banker
shall include the following notice to each mortgage loan applicant
at the time of application: "COMPLAINTS REGARDING MORTGAGE BANKERS
SHOULD BE SENT TO THE TEXAS SAVINGS AND LOAN DEPARTMENT, 2601 NORTH
LAMAR, SUITE 201, AUSTIN, TEXAS 78705. A TOLL-FREE CONSUMER
HOTLINE IS AVAILABLE AT 1-877-276-5550."
Section 157.008. COMPLAINTS. On the signed written
complaint of a person against a specific mortgage banker, the
commissioner shall notify the mortgage banker in writing of the
complaint and provide a copy of the complaint. The commissioner may
request and the mortgage banker shall promptly provide such
documentary or other evidence as the commissioner deems necessary
to effectively evaluate the complaint, including but not limited to
correspondence, loan documents and disclosures. The commissioner
may ask the mortgage banker to resolve the complaint and/or provide
the commissioner with a response. The commissioner may direct the
mortgage banker in writing to take specific action to resolve the
complaint.
Section 157.009. TERMINATION OF REGISTRATION.
(A) A mortgage banker may withdraw or rescind its
registration at any time.
(B) The commissioner may revoke a registration if
a mortgage banker fails to pay the annual fee within thirty days of
the date the commissioner advises the mortgage banker payment is in
default.
(C) The commissioner may revoke a registration if
a mortgage banker fails or refuses to comply with the
commissioner's written request for a response to a consumer
complaint.
(D) The commissioner may revoke a registration
if, after considering a complaint filed under this chapter, the
commissioner concludes that a mortgage banker has engaged in an
intentional course of conduct to violate federal or state law or is
engaged in an intentional course of conduct that constitutes
improper, fraudulent or dishonest dealings.
(E) If the commissioner proposes to suspend or
revoke a registration under Section 157.009(C) or (D), the mortgage
banker is entitled to a hearing before the commissioner or a
hearings officer who shall make a proposal for decision to the
commissioner. The commissioner or hearings officer shall prescribe
the time and place of hearing. The hearing is governed by Chapter
2001, Government Code.
(F) The commissioner may revoke the registration
under Section 157.009(D) only if the commissioner concludes that
the mortgage banker has engaged in an intentional course of conduct
to violate state or federal law or has engaged in an intentional
course of conduct that constitutes improper, fraudulent or
dishonest dealings. The commissioner shall recite in his order of
termination or revocation the basis of that decision.
(G) A mortgage banker aggrieved by a ruling,
order or decision of the commissioner has the right to appeal to a
district court in the county in which the hearing was held. An
appeal under this subsection is governed by Chapter 2001,
Government Code.
Section 157.010. RE-REGISTRATION.
(A) A mortgage banker whose registration was
previously terminated by action of the commissioner can register
again only with the prior authorization or approval of the
commissioner. The commissioner shall give that authorization and
approval for the registration if the commissioner concludes that
the mortgage banker will operate in compliance with state and
federal law and not engage in improper, fraudulent, or dishonest
dealings.
(B) A mortgage banker who seeks re-registration
may request and is entitled to a hearing before the commissioner or
a hearings officer who shall make a proposal for decision to the
commissioner. The hearing is governed by Chapter 2001, Government
Code.
(C) If the commissioner denies authorization for
the re-registration, the commissioner shall set out the basis of
his decision in an order.
(D) If the commissioner denies or refuses to
grant permission for the re-registration, the denied mortgage
banker has the right to appeal to a district court in Travis County.
An appeal under this subsection is governed by Chapter 2001,
Government Code.
SECTION 2. This Act takes effect September 1, 2003.