Senate Bill sb2526

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    Florida Senate - 2007                                  SB 2526

    By Senator Bennett


  1                      A bill to be entitled

  2         An act relating to mortgage lenders; amending

  3         s. 494.006, F.S.; exempting from licensure

  4         requirements certain persons who are under

  5         exclusive contract with a licensed mortgage

  6         lender; establishing requirements for such

  7         persons, including obtaining an undertaking of

  8         responsibility and a surety bond; providing an

  9         effective date.


11  Be It Enacted by the Legislature of the State of Florida:


13         Section 1.  Subsection (2) of section 494.006, Florida

14  Statutes, is amended to read:

15         494.006  Exemptions.--

16         (2)(a)  A natural person employed by a mortgage lender

17  or correspondent mortgage lender licensed under ss.

18  494.001-494.0077 is exempt from the licensure requirements of

19  ss. 494.001-494.0077 when acting within the scope of

20  employment with the licensee.

21         (b)  A corporation that is in existence on October 1,

22  1991, and that is a wholly owned subsidiary of a consumer

23  finance company licensed pursuant to chapter 516 on October 1,

24  1991, is not required to be licensed under ss.

25  494.006-494.0077 in order to act as a mortgage lender or a

26  correspondent mortgage lender.

27         (c)  A natural person who is under exclusive contract

28  with a licensee under ss. 494.006-494.0077 to perform services

29  that require licensure pursuant to this chapter is exempt from

30  the licensure requirements of ss. 494.003-494.0043 when acting

31  within the scope of the exclusive contract, if the licensee:


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    Florida Senate - 2007                                  SB 2526

 1         1.  Originates or brokers mortgage loans only with

 2  mortgage lenders affiliated with the licensee through ultimate

 3  common ownership;

 4         2.  Has provided the office with an undertaking of

 5  accountability in substantially the following form:


 7         The undersigned entity assumes full and direct

 8         financial responsibility for all acts as a loan

 9         originator or acts as a mortgage broker

10         regulated pursuant to ss. 494.001-494.0077,

11         Florida Statutes, and any rules adopted under

12         those provisions by its representatives under

13         exclusive contract. It is fully understood and

14         agreed that the Florida Office of Financial

15         Regulation may take regulatory action against

16         the undersigned corporate licensee for unlawful

17         acts as loan originators or acts as mortgage

18         brokers of such representatives, which acts are

19         not in compliance with ss. 494.001-494.0077,

20         Florida Statutes, and any rules adopted under

21         those provisions.


23  [Corporate Name]

24                              By:_______________________

25          [Name and title of person signing on behalf of

26                                            corporation]

27                              Date:_____________________


29         3.  Has provided a surety bond in the amount of $5

30  million to guarantee the obligations under subparagraph 2.

31  This subparagraph is not a limitation on any recovery against


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    Florida Senate - 2007                                  SB 2526

 1  the licensee based on the mortgage brokerage or lending

 2  activities conducted by any person exempted by this section.

 3         a.  The surety bond must be in a form satisfactory to

 4  the office and shall run to the state for the benefit of any

 5  claimant in this state against the licensee or any person

 6  exempted by this section. A claimant may bring suit directly

 7  on the surety bond, or the office may bring suit on behalf of

 8  the claimant, in one action or successive actions, after the

 9  claimant has secured a judgment against the licensee which the

10  licensee has not satisfied.

11         b.  A corporate surety bond filed with the office to

12  comply with this paragraph may not be cancelled by the

13  licensee or the corporate surety except upon written notice to

14  the office by registered or certified mail with return receipt

15  requested. A cancellation mat not take effect less than 30

16  days after the office receives such written notice.

17         c.  The corporate surety shall, within 10 days after it

18  pays a claim to any claimant, give written notice of such

19  payment to the office by registered or certified mail, along

20  with details that are sufficient to identify the claimant and

21  the claim or judgment paid.

22         d.  If the principal sum of the bond is reduced by any

23  recoveries or payments, the licensee must furnish a new or

24  additional bond so that the total or aggregate principal sum

25  of the bond equals the amount required by this paragraph.

26  Alternatively, a licensee may furnish an endorsement executed

27  by the corporate surety reinstating the bond to the required

28  principal sum.

29         e.  A licensee shall maintain the bond in the amount

30  prescribed by this paragraph. If the office reasonably

31  determines that the bond is deficient in amount, or exhausted


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    Florida Senate - 2007                                  SB 2526

 1  in whole or in part, the office may, by written order, require

 2  the filing of a new or supplemental bond.

 3         f.  The bond shall remain in place for 5 years after

 4  the licensee ceases operations in this state;

 5         4.  Has implemented a business plan providing for the

 6  education of the persons exempted by this section which is

 7  commensurate with their duties and responsibilities, the

 8  handling of consumer complaints related to such persons, and

 9  the supervision of the mortgage-related activities of such

10  persons. The business plan shall be designed to prevent and

11  detect violations of this chapter; and

12         5.  Has conducted a national background check for each

13  person exempted by this section and, based on such background

14  check, the subsidiary or affiliate may not, without the prior

15  written consent of the office, contract with any person to act

16  as an exclusive agent who has been subject to an action

17  specified in s. 494.0041(2)(a), (t), and (u).

18         Section 2.  This act shall take effect July 1, 2007.


20            *****************************************

21                          SENATE SUMMARY

22    Exempts from licensure requirements certain persons who
      are under contract with licensed mortgage lenders.
23    Provides requirements therefor.










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