The Florida Senate

494.0023  Conflicting interest.--

(1)  If, in a mortgage transaction, a licensee has a conflicting interest as specified in subsection (2):

(a)  The type of conflicting interest shall be fully and fairly disclosed.

(b)  The licensee shall inform the borrower in writing that a financial benefit may be received by the licensee as a result of the conflicting interest.

(c)  The borrower shall be informed that alternative sources may be chosen by the borrower to provide any required services. The following language must be contained in 12-point type in any agreement between a mortgage broker, mortgage lender, or correspondent mortgage lender and a borrower in substantially this form:

You are not required to purchase additional products or services from any person or entity suggested or recommended by (Broker/Lender/Correspondent Lender). However, the (Broker/Lender/Correspondent Lender) hereby reserves the right to approve the entity selected by the borrower, which approval may not be unreasonably withheld.

(2)  A licensee has a conflicting interest if:

(a)  The licensee or the licensee's relative provides the borrower with additional products or services;

(b)  The licensee or licensee's relative, either directly or indirectly, owns, controls, or holds with power to vote, or holds proxies representing, 10 percent or more of any class of equity securities or other beneficial interest in such person providing the additional products or services;

(c)  The person providing the additional products or services, either directly or indirectly, owns, controls, or holds the power to vote, or holds proxies representing, 10 percent or more of any class of equity securities or other beneficial interest in the licensee;

(d)  A holding company, either directly or indirectly, owns, controls, or holds with power to vote, or holds proxies representing, 10 percent or more of any class of equity securities or other beneficial interest in both the licensee and the person providing the additional products or services;

(e)  One or more persons, or such person's relative, sits as an officer or director, or performs similar functions as an officer or director, for both the licensee and the person providing the additional products or services; or

(f)  The licensee or the licensee's relative sits as an officer or director, or performs similar functions as an officer or director, of the person providing the additional products or services.

(3)  As used in this section, the term "relative" of any natural person means any of the following persons, whether by the full or half blood or by adoption:

(a)  Such person's spouse, father, mother, children, brothers, and sisters.

(b)  The father, mother, brothers, and sisters of such person's spouse.

(c)  The spouses of children, brothers, or sisters of such person.

History.--ss. 14, 50, ch. 91-245; s. 4, ch. 91-429.