EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*sb1026*
SENATE BILL 1026
I1 EMERGENCY BILL 5lr3555
CF HB 1516
By: Senator Beidle
Introduced and read first time: February 6, 2025
Assigned to: Rules
Re–referred to: Finance, February 18, 2025
Committee Report: Favorable with amendments
Senate action: Adopted
Read second time: February 26, 2025
CHAPTER ______
AN ACT concerning 1
Financial Institutions – Consumer Credit – Application of Licensing 2
Requirements 3
(Maryland Secondary Market Stability Act of 2025) 4
FOR the purpose of providing that certain provisions of law governing the licensing of 5
providers of certain financial services in the State do not apply to a certain person 6
that acquires or is assigned a certain mortgage, mortgage loan, or installment loan 7
under certain circumstances; establishing the Maryland Licensing Workgroup to 8
study and make recommendations on licensing requirements for persons that 9
provide financial services in the State; and generally relating to consumer credit 10
lending licensing requirements and the Maryland Licensing Workgroup. 11
BY repealing and reenacting, without amendments, 12
Article – Financial Institutions 13
Section 1–101(a) and (n), 11–301(a) and (b), and 11–501(a) and (k) through (m) 14
Annotated Code of Maryland 15
(2020 Replacement Volume and 2024 Supplement) 16
BY adding to 17
Article – Financial Institutions 18
Section 11–102 19
Annotated Code of Maryland 20
(2020 Replacement Volume and 2024 Supplement) 21
2 SENATE BILL 1026
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 1
That the Laws of Maryland read as follows: 2
Article – Financial Institutions 3
1–101. 4
(a) In this article, unless the context clearly requires otherwise, the following 5
words have the meanings indicated. 6
(n) “Mortgage” includes a deed of trust that secures a debt or the performance of 7
an obligation. 8
11–102. 9
(A) IN THIS SECTION, “INSTALLMENT LOAN ” HAS THE MEANING STAT ED IN 10
§ 11–301 OF THIS TITLE. 11
(B) EXCEPT FOR § 11–219 OF THIS TITLE, THIS TITLE DOES NOT APPLY TO A 12
PERSON THAT ACQUIRES OR IS ASSIGNED IN WH OLE OR IN PART: 13
(1) A MORTGAGE , IF THE PERSON DOES N OT OTHERWISE MAKE 14
MORTGAGES ; 15
(2) A MORTGAGE LOAN , AS DEFINED IN § 11–501 OF THIS TITLE, IF 16
THE PERSON DOES NOT OTHERWISE ENGAGE IN THE MORTGAG E LENDING 17
BUSINESS, AS DEFINED IN § 11–501 OF THIS TITLE; OR 18
(3) AN INSTALLMENT LOAN , IF THE PERSON: 19
(I) RELIES ON ANOTHER PER SON TO SERVICE OR CO LLECT ON 20
THE INSTALLMENT LOAN ; AND 21
(II) DOES NOT OTHERWISE MA KE INSTALLMENT LOANS . 22
(C) THIS SECTION MAY NOT BE C ONSTRUED TO ALTER TH E DEFINITION OF 23
“STUDENT LOAN SERVICE R”, AS DEFINED IN § 2–104.1 OF THIS ARTICLE. 24
11–301. 25
(a) In this subtitle the following words have the meanings indicated. 26
(b) “Installment loan” means a loan or extension of credit made for consideration 27
under § 12–103(a)(3) or (c) or Title 12, Subtitle 9, or Subtitle 10 of the Commercial Law 28
Article. 29
SENATE BILL 1026 3
11–501. 1
(a) In this subtitle the following words have the meanings indicated. 2
(k) (1) “Mortgage lender” means any person who: 3
(i) Is a mortgage broker; 4
(ii) Makes a mortgage loan to any person; or 5
(iii) Is a mortgage servicer. 6
(2) “Mortgage lender” does not include: 7
(i) A financial institution that accepts deposits and is regulated 8
under Title 3, Title 4, Title 5, or Title 6 of this article; 9
(ii) The Federal Home Loan Mortgage Corporation; 10
(iii) The Federal National Mortgage Association; 11
(iv) The Government National Mortgage Association; 12
(v) Any person engaged exclusively in the acquisition of all or any 13
portion of a mortgage loan under any federal, State, or local governmental program of 14
mortgage loan purchases; or 15
(vi) An affiliated insurance producer–mortgage loan originator 16
licensed under § 11–603.1 of this title. 17
(l) (1) “Mortgage lending business” means the activities set forth in the 18
definition of “mortgage lender” in subsection (k) of this section which require that person 19
to be licensed under this subtitle. 20
(2) “Mortgage lending business” includes the making or procuring of 21
mortgage loans secured by a dwelling or residential real estate located outside Maryland. 22
(m) (1) “Mortgage loan” means any loan primarily for personal, family, or 23
household use that is secured by a mortgage, deed of trust, or other equivalent consensual 24
security interest on a dwelling or residential real estate on which a dwelling is constructed 25
or intended to be constructed. 26
(2) “Mortgage loan” includes a loan in which funds are advanced through a 27
shared appreciation agreement. 28
SECTION 2. AND BE IT FURTHER ENACTED, That: 29
4 SENATE BILL 1026
(a) There is a Maryland Licensing Workgroup. 1
(b) The Workgroup consists of the following members: 2
(1) the Commissioner of Financial Regulation, or the Commissioner’s 3
designee; 4
(2) the following members jointly appointed by the President of the Senate 5
and the Speaker of the House: 6
(i) one representative of a consumer advocacy organization with 7
general knowledge about financial services, lending services, capital markets, and 8
structured finance; 9
(ii) one representative of a banking institution operating in the 10
State; 11
(iii) one representative of a credit union operating in the State; 12
(iv) one representative of a nonbank mortgage business operating in 13
the State; and 14
(v) one member with expertise in: 15
1. State laws and regulations that impact the chartering, 16
licensing, and supervision of the lending industry within the State; and 17
2. financial products and practices that impact consumers; 18
and 19
(3) the following members appointed by the Governor: 20
(i) one member who has general knowledge about financial services, 21
lending services, capital markets, and structured finance; and 22
(ii) one member of the public. 23
(c) The Commissioner of Financial Regulation, or the Commissioner’s designee, 24
shall serve as the chair of the Workgroup. 25
(d) The Office of Financial Regulation shall provide staff for the Workgroup. 26
(e) A member of the Workgroup: 27
(1) may not receive compensation as a member of the Workgroup; but 28
SENATE BILL 1026 5
(2) is entitled to reimbursement for expenses under the Standard State 1
Travel Regulations, as provided in the State budget. 2
(f) The Workgroup shall: 3
(1) subject to subsection (g) of this section, study: 4
(i) all licensing statutes and regulations adopted under those 5
statutes concerning the provision of financial services in the State; 6
(ii) the need for and the efficacy of the existing licensing and 7
registration system for actively licensed persons who provide financial services in the State; 8
and 9
(iii) whether there is any benefit to expanding existing licensing or 10
registration systems to persons not already subject to those licensing requirements; and 11
(2) make recommendations regarding: 12
(i) the licensing and registration system for actively licensed 13
persons who provide financial services in the State; and 14
(ii) the expansion of the existing licensing or registration systems to 15
persons not already subject to those licensing requirements. 16
(g) In conducting the study required under subsection (f) of this section, the 17
Workgroup shall, at a minimum, consider the potential impacts, costs, and benefits of its 18
recommendations on: 19
(1) residents of the State; 20
(2) persons facilitating, brokering, making, servicing, or acquiring loans in 21
the State; 22
(3) the availability of credit in the State; 23
(4) the cost of credit in the State compared to other states; and 24
(5) the capital markets, including the volume of secondary market 25
transactions. 26
(h) On or before December 31, 2025, the Workgroup shall report its findings and 27
recommendations to the Governor and, in accordance with § 2 –1257 of the State 28
Government Article, the General Assembly. 29
SECTION 3. AND BE IT FURTHER ENACTED, That the intent of Section 1 of this 30
Act is to clarify existing exemptions under State law. 31 6 SENATE BILL 1026
SECTION 4. AND BE IT FURTHER ENACTED, That this Act is an emergency 1
measure, is necessary for the immediate preservation of the public health or safety, has 2
been passed by a yea and nay vote supported by three–fifths of all the members elected to 3
each of the two Houses of the General Assembly, and shall take effect from the date it is 4
enacted. Section 2 of this Act shall remain effective through June 30, 2026, and, at the end 5
of June 30, 2026, Section 2 of this Act, with no further action required by the General 6
Assembly, shall be abrogated and of no further force and effect. 7
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
President of the Senate.
________________________________________________________________________________
Speaker of the House of Delegates.