Texas 2019 - 86th Regular

Texas House Bill HB3140 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	86R13739 CLG-F
2	2	By: Guillen H.B. No. 3140
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the regulation of residential mortgage loan companies,
8	8	including requiring the registration of mortgage lot lender
9	9	companies; imposing a fee.
10	10	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	11	SECTION 1. Section 156.002, Finance Code, is amended by
12	12	adding Subdivision (8-b) and amending Subdivisions (10-b) and (13)
13	13	to read as follows:
14	14	(8-b) "Mortgage lot lender company" means a
15	15	corporation, company, partnership, or sole proprietorship that
16	16	engages in the business of residential mortgage loan origination on
17	17	residential real estate located in this state on which no dwelling
18	18	is constructed to purchasers of the residential real estate for all
19	19	or part of the purchase price of the residential real estate against
20	20	which the mortgage is secured.
21	21	(10-b) "Qualifying individual" means an individual
22	22	who is:
23	23	(A) except as provided by Section
24	24	156.2013(b)(3), licensed under Chapter 157 as a residential
25	25	mortgage loan originator; and
26	26	(B) designated by a residential mortgage loan
27	27	company as the company's representative.
28	28	(13) "Residential mortgage loan company" means a
29	29	person, other than an individual, that engages in the business of
30	30	residential mortgage loan origination on residential real estate
31	31	located in this state. The term includes a credit union subsidiary
32	32	organization, auxiliary mortgage loan activity company, mortgage
33	33	company, independent contractor loan processor or underwriter
34	34	company, mortgage lot lender company, and financial services
35	35	company.
36	36	SECTION 2. Section 156.201, Finance Code, is amended to
37	37	read as follows:
38	38	Sec. 156.201. LICENSES REQUIRED. (a) A person may not act
39	39	in the capacity of, engage in the business of, or advertise or hold
40	40	that person out as engaging in or conducting the business of a
41	41	residential mortgage loan company in this state unless the person
42	42	holds an active residential mortgage loan company license, is
43	43	registered under Section 156.2012 or 156.2013, or is exempt under
44	44	Section 156.202.
45	45	(c) Each residential mortgage loan company and the
46	46	company's qualifying individual are [licensed under Chapter 157 is]
47	47	responsible to the commissioner and members of the public for any
48	48	act or conduct performed by the residential mortgage loan
49	49	originator sponsored by or acting for the residential mortgage loan
50	50	company in connection with:
51	51	(1) the origination of a residential mortgage loan; or
52	52	(2) a transaction that is related to the origination
53	53	of a residential mortgage loan in which the qualifying individual
54	54	knew or should have known of the transaction.
55	55	SECTION 3. Section 156.2012(a), Finance Code, is amended to
56	56	read as follows:
57	57	(a) A financial services company may perform the services of
58	58	a residential mortgage loan company if the company is registered
59	59	under this section [chapter].
60	60	SECTION 4. Subchapter C, Chapter 156, Finance Code, is
61	61	amended by adding Section 156.2013 to read as follows:
62	62	Sec. 156.2013. REGISTERED MORTGAGE LOT LENDER COMPANY. (a)
63	63	A mortgage lot lender company may perform the services of a
64	64	residential mortgage loan company if the company is registered
65	65	under this section.
66	66	(b) To be registered as a mortgage lot lender company, a
67	67	person must:
68	68	(1) submit a completed application together with the
69	69	payment of applicable fees through the Nationwide Mortgage
70	70	Licensing System and Registry;
71	71	(2) designate control persons for the company through
72	72	the Nationwide Mortgage Licensing System and Registry;
73	73	(3) designate an individual as the company's
74	74	qualifying individual who is either:
75	75	(A) an owner, officer, or partner of the company;
76	76	or
77	77	(B) a residential mortgage loan originator who is
78	78	licensed under Chapter 157;
79	79	(4) properly sponsor one or more residential mortgage
80	80	loan originators who are licensed under Chapter 157;
81	81	(5) not be in violation of this chapter, a rule adopted
82	82	under this chapter, or any order previously issued by the
83	83	commissioner to the person;
84	84	(6) have the company name or assumed name properly
85	85	filed with either the secretary of state or the appropriate county
86	86	clerk's office;
87	87	(7) maintain a physical office in this state; and
88	88	(8) provide any other information required by the
89	89	commissioner.
90	90	(c) If the commissioner determines that a person has met the
91	91	requirements of Subsection (b) and pays a registration fee in an
92	92	amount not to exceed $500, the commissioner shall issue a
93	93	registration to the person. The registration is valid for one year,
94	94	expires on December 31 of each year, and must be renewed annually by
95	95	meeting the requirements under Subsection (b) and paying a renewal
96	96	fee in an amount not to exceed $500. A person must renew an expired
97	97	registration in the manner determined by the commissioner.
98	98	(d) A registered mortgage lot lender company is subject to
99	99	Subchapters D and E as if the company were licensed as a residential
100	100	mortgage loan company.
101	101	SECTION 5. Section 156.202(a-1), Finance Code, is amended
102	102	to read as follows:
103	103	(a-1) The following entities are exempt from this chapter:
104	104	(1) a nonprofit organization:
105	105	(A) providing self-help housing that originates
106	106	zero interest residential mortgage loans for borrowers who have
107	107	provided part of the labor to construct the dwelling securing the
108	108	loan; or
109	109	(B) that has designation as a Section 501(c)(3)
110	110	organization by the Internal Revenue Service and originates
111	111	residential mortgage loans for borrowers who, through a self-help
112	112	program, have provided at least 200 labor hours or 65 percent of the
113	113	labor to construct the dwelling securing the loan;
114	114	(2) a mortgage banker registered under Chapter 157;
115	115	(3) any owner of residential real estate who in any
116	116	12-consecutive-month period makes no more than five residential
117	117	mortgage loans to purchasers of the residential real estate
118	118	[property] for all or part of the purchase price of the residential
119	119	real estate against which the mortgage is secured; and
120	120	(4) an entity that is:
121	121	(A) a depository institution;
122	122	(B) a subsidiary of a depository institution that
123	123	is:
124	124	(i) owned and controlled by the depository
125	125	institution; and
126	126	(ii) regulated by a federal banking agency;
127	127	or
128	128	(C) an institution regulated by the Farm Credit
129	129	Administration.
130	130	SECTION 6. Section 156.203, Finance Code, is amended by
131	131	adding Subsection (a-3) to read as follows:
132	132	(a-3) An application for a mortgage lot lender company
133	133	registration under Section 156.2013 must be:
134	134	(1) in writing;
135	135	(2) under oath; and
136	136	(3) on the form prescribed by the commissioner.
137	137	SECTION 7. As soon as practicable after the effective date
138	138	of this Act, the Finance Commission of Texas shall adopt the rules
139	139	necessary to implement the changes in law made by this Act, and the
140	140	savings and mortgage lending commissioner shall begin registering
141	141	persons as mortgage lot lender companies as required by Section
142	142	156.2013, Finance Code, as added by this Act.
143	143	SECTION 8. This Act takes effect September 1, 2019.