86R10152 TSR-F
By: Parker H.B. No. 3945
A BILL TO BE ENTITLED
AN ACT
relating to the temporary authority of certain individuals to
engage in business as a residential mortgage loan originator.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 157.012(a), Finance Code, is amended to
read as follows:
(a) An individual may not act or attempt to act in the
capacity of a residential mortgage loan originator unless the
individual is exempt under Section 157.0121 or 180.003(b), or
acting under the temporary authority granted under Section
180.0511, or:
(1) is licensed under this chapter, sponsored by an
appropriate entity, and enrolled with the Nationwide Mortgage
Licensing System and Registry as required by Section 180.052; and
(2) complies with other applicable requirements of
Chapter 180 and rules adopted by the finance commission under that
chapter.
SECTION 2. Section 180.002(11), Finance Code, is amended to
read as follows:
(11) "Loan processor or underwriter" means an
individual who performs clerical or support duties as an employee
at the direction of and subject to the supervision and instruction
of an individual licensed as a residential mortgage loan
originator, [or] exempt from licensure under Section 180.003, or
acting under the temporary authority granted under Section
180.0511.
SECTION 3. Section 180.051(a), Finance Code, is amended to
read as follows:
(a) Unless exempted by Section 180.003 or acting under the
temporary authority granted under Section 180.0511, an individual
may not engage in business as a residential mortgage loan
originator with respect to a dwelling located in this state unless
the individual:
(1) is licensed to engage in that business under
Chapter 156, 157, 342, 347, 348, or 351; and
(2) complies with the requirements of this chapter.
SECTION 4. Subchapter B, Chapter 180, Finance Code, is
amended by adding Section 180.0511 to read as follows:
Sec. 180.0511. TEMPORARY AUTHORITY FOR EMPLOYMENT
TRANSITIONS. (a) A registered mortgage loan originator who does
not hold a license issued under a chapter listed in Section
180.051(a)(1) to engage in business as a residential mortgage loan
originator with respect to a dwelling located in this state may
engage in that business for a period not to exceed 120 days as
provided by Subsection (c) if the individual:
(1) becomes employed by an entity that is licensed or
registered in this state to engage in the business of residential
mortgage loan origination or processing activities with respect to
a dwelling located in this state;
(2) has not had:
(A) an application for a residential mortgage
loan originator license or other loan originator license required
by another jurisdiction to engage in business as a residential
mortgage loan originator denied; or
(B) a residential mortgage loan originator
license or other loan originator license required by another
jurisdiction to engage in business as a residential mortgage loan
originator revoked or suspended in any governmental jurisdiction;
(3) has not been subject to or served with a cease and
desist order:
(A) in any governmental jurisdiction; or
(B) under 12 U.S.C. Section 5113(c);
(4) has not been convicted of a misdemeanor or felony
that would preclude licensure to engage in business as a
residential mortgage loan originator with respect to a dwelling
located in this state under the chapters listed in Section
180.051(a)(1);
(5) has submitted to the appropriate regulatory
official the application form prescribed by the regulatory official
under Section 180.053 and the information required under Section
180.054; and
(6) was registered with, and maintained a unique
identifier through, the Nationwide Mortgage Licensing System and
Registry as a loan originator during the one-year period preceding
the date on which the individual submitted to the appropriate
regulatory official the application form and information required
by Subdivision (5).
(b) A residential mortgage loan originator licensed to
engage in that activity in another state may engage in business as a
residential mortgage loan originator with respect to a dwelling
located in this state for a period not to exceed 120 days as
provided by Subsection (c) without holding a license to engage in
that business issued under a chapter listed in Section
180.051(a)(1) if the individual:
(1) is employed by an entity that is licensed or
registered in this state to engage in the business of residential
mortgage loan origination or processing activities with respect to
a dwelling located in this state;
(2) meets the eligibility requirements provided by
Subsections (a)(2), (3), (4), and (5); and
(3) holds a license issued by another state to engage
in business as a residential mortgage loan originator and held that
license during the 30-day period preceding the date on which the
individual submitted to the appropriate regulatory official the
application form required under Section 180.053 and the information
required under Section 180.054.
(c) The 120-day period of temporary authority granted to an
individual under this section begins on the date on which the
individual submits to the appropriate regulatory official the
application form required under Section 180.053 and the information
required under Section 180.054 and ends on the earliest of:
(1) the date on which the individual withdraws the
application;
(2) the date on which the regulatory official denies
or issues a notice of intent to deny the application;
(3) the date on which the regulatory official issues
the individual a license to engage in business as a residential
mortgage loan originator with respect to a dwelling located in this
state under a chapter listed in Section 180.051(a)(1); or
(4) the 120th day after the date on which the
individual submitted the application, if the application is listed
on the Nationwide Mortgage Licensing System and Registry as
incomplete.
SECTION 5. Section 342.0515(b), Finance Code, is amended to
read as follows:
(b) Unless exempt under Section 180.003, or acting under the
temporary authority granted under Section 180.0511, an individual
who acts as a residential mortgage loan originator in the making,
transacting, or negotiating of a loan subject to this chapter must:
(1) be individually licensed to engage in that
activity under this chapter;
(2) be enrolled with the Nationwide Mortgage Licensing
System and Registry as required by Section 180.052; and
(3) comply with other applicable requirements of
Chapter 180 and rules adopted under that chapter.
SECTION 6. Section 347.4515(b), Finance Code, is amended to
read as follows:
(b) Unless exempt under Section 180.003, or acting under the
temporary authority granted under Section 180.0511, an individual
who acts as a residential mortgage loan originator in the making,
transacting, or negotiating of an extension of credit subject to
this chapter must:
(1) be individually licensed to engage in that
activity under this chapter;
(2) be enrolled with the Nationwide Mortgage Licensing
System and Registry as required by Section 180.052; and
(3) comply with other applicable requirements of
Chapter 180 and rules adopted under that chapter.
SECTION 7. Section 348.5015(b), Finance Code, is amended to
read as follows:
(b) Unless exempt under Section 180.003, or acting under the
temporary authority granted under Section 180.0511, an individual
who acts as a residential mortgage loan originator in the sale of a
motor vehicle to be used as a principal dwelling must:
(1) be licensed to engage in that activity under this
chapter;
(2) be enrolled with the Nationwide Mortgage Licensing
System and Registry as required by Section 180.052; and
(3) comply with other applicable requirements of
Chapter 180 and rules adopted under that chapter.
SECTION 8. Section 351.0515(b), Finance Code, is amended to
read as follows:
(b) Unless exempt under Section 180.003, or acting under the
temporary authority granted under Section 180.0511, an individual
who acts as a residential mortgage loan originator in the making,
transacting, or negotiating of a property tax loan for a principal
dwelling must:
(1) be individually licensed to engage in that
activity under this chapter;
(2) be enrolled with the Nationwide Mortgage Licensing
System and Registry as required by Section 180.052; and
(3) comply with other applicable requirements of
Chapter 180 and rules adopted under that chapter.
SECTION 9. Section 180.0511, Finance Code, as added by this
Act, applies only to an application for a residential mortgage loan
originator license submitted to the appropriate regulatory
official, as defined by Section 180.002, Finance Code, on or after
the effective date of this Act. An application for a residential
mortgage loan originator license submitted before that date is
governed by the law in effect on the date the application was
submitted, and the former law is continued in effect for that
purpose.
SECTION 10. This Act takes effect November 24, 2019.