Feed for /1997/related/acts/145 PDF
a. A certificate of deposit.
b. A debt security acceptable to the division.
c. An irrevocable bank letter of credit issued by a financial institution that is authorized to do business in this state or that is federally chartered.
3. `Minimum net worth.' Submit evidence that establishes, to the division's satisfaction, a minimum net worth of $100,000. Evidence of net worth shall include the submission of a balance sheet that is accompanied by a written statement by an independent certified public accountant attesting that he or she has reviewed the balance sheet in accordance with generally accepted accounting principles.
(b) Without a bona fide office. In addition to the requirements of sub. (2), an applicant for registration as a mortgage broker who does not maintain a bona fide office shall do all of the following:
1. `File a bond.' File with the division a commercial surety bond that is in the amount of $120,000, is issued by a surety company authorized to do business in this state, secures the applicant's faithful performance of all duties and obligations of a mortgage broker, is payable to the division for the benefit of persons to whom the mortgage broker provided services as a mortgage broker, is issued on a form that is acceptable to the division and provides that the bond may not be terminated without at least 30 days' written notice to the division.
2. `Minimum net worth.' Submit evidence that establishes, to the division's satisfaction, a minimum net worth of $250,000. Evidence of net worth shall include the submission of a balance sheet that is accompanied by a written statement by an independent certified public accountant attesting that he or she has reviewed the balance sheet in accordance with generally accepted accounting principles.
145,24 Section 24. 224.72 (4n) of the statutes is created to read:
224.72 (4n) Security held by the division; release. The division or its agent shall hold security filed under subs. (4) (a) 3. and (4m) (a) 2. The security shall remain in effect, and the division may not release it, until all of the following conditions are met:
(a) A period of 180 days has elapsed since at least one of the following:
1. The date on which the mortgage banker or mortgage broker gives notice to the division that the mortgage banker or mortgage broker is no longer acting as a mortgage banker or mortgage broker.
2. The date on which the mortgage banker's or mortgage broker's registration expires or is revoked.
(b) The division determines that the mortgage banker or mortgage broker is no longer in business.
(c) The division determines that all claims of persons to whom the mortgage banker or mortgage broker provided services as a mortgage banker or mortgage broker have been satisfied.
145,25 Section 25. 224.72 (4r) of the statutes is created to read:
224.72 (4r) Insufficient security; division order; suspension of registration. If the division finds that the surety bond, security or insurance policy filed by a mortgage banker or mortgage broker has been cancelled without the required notice to the division, the division may summarily suspend the mortgage banker's or mortgage broker's registration.
145,26 Section 26. 224.72 (5) (a) of the statutes is amended to read:
224.72 (5) (a) (title) Loan originator and loan solicitor. Upon receiving a properly completed application for registration as a loan originator or loan solicitor and the fee specified in rules promulgated under sub. (8) (a), the department shall division may issue to the applicant a certificate of registration as a loan originator or loan solicitor.
145,27 Section 27. 224.72 (5) (b) 1. of the statutes, as affected by 1997 Wisconsin Acts 27 and 35, is renumbered 224.72 (5) (b) and amended to read:
224.72 (5) (b) (title) Mortgage banker and mortgage broker. Upon receiving a properly completed application for registration as a mortgage banker or a mortgage broker, the fee specified in rules promulgated under sub. (8) (b) and satisfactory evidence of compliance with sub. subs. (4) and (4m), the department shall division may issue to the applicant a temporary certificate of registration as a mortgage banker. A temporary certificate of registration is valid for 6 months after the date of issuance or mortgage broker.
145,28 Section 28. 224.72 (5) (b) 2. of the statutes is repealed.
145,29 Section 29. 224.72 (7) of the statutes, as affected by 1997 Wisconsin Act 27, is repealed and recreated to read:
224.72 (7) Renewal of registration. (a) A loan originator, mortgage broker or mortgage banker shall renew a certificate of registration by submitting to the division a renewal application and the renewal fee specified in rules promulgated under sub. (8) on or before the renewal date specified in rules promulgated under sub. (8).
(b) An applicant for renewal of a certificate of registration as a mortgage banker shall, as part of the application, do the following:
1. For a mortgage banker who maintains a bona fide office, refile a bond that satisfies sub. (4) (a) 2. or 3. or resubmit evidence that satisfies sub. (4) (a) 1. or 4.
2. For a mortgage banker who does not maintain a bona fide office, refile a bond that satisfies sub. (4) (d) 1. and resubmit evidence that satisfies sub. (4) (d) 2.
(c) An applicant for renewal of a certificate of registration as a mortgage broker shall, as part of the application, do the following:
1. For a mortgage broker who maintains a bona fide office, refile a bond that satisfies sub. (4m) (a) 1. or 2. or resubmit evidence that satisfies sub. (4m) (a) 3.
2. For a mortgage broker who does not maintain a bona fide office, refile a bond that satisfies sub. (4m) (b) 1. and resubmit evidence that satisfies sub. (4m) (b) 2.
145,30 Section 30. 224.72 (8) of the statutes is repealed and recreated to read:
224.72 (8) Registration period; fees. The division shall promulgate rules establishing the registration period and the registration fees for loan originators, mortgage bankers and mortgage brokers.
145,31 Section 31. 224.73 of the statutes is amended to read:
224.73 (title) Relationship between loan originator and either a mortgage banker or a mortgage broker. (1) Responsibility for loan originator. A mortgage banker or a mortgage broker is responsible for, and shall supervise the acts of, a loan originator who registers under s. 224.72 (3) as an employe of the mortgage banker or mortgage broker. A mortgage banker or mortgage broker is also responsible for, and shall supervise the acts of, a loan originator or any other person who otherwise acts on behalf of the mortgage banker or the mortgage broker.
(2) Restriction on loan originator. If the department division suspends or revokes a mortgage banker's or a mortgage broker's certificate of registration, a loan originator may not act on behalf of that mortgage banker or mortgage broker during the period of suspension or revocation.
(3) Transfer by loan originator. A registered loan originator may at any time apply, on forms prescribed and provided by the department division, to transfer employment to another registered mortgage banker or mortgage broker. The fee for transfer is specified under s. 224.72 (8) (d) and is payable when the loan originator files the application division shall promulgate rules establishing a fee for a transfer application under this subsection.
145,32 Section 32. 224.74 (title) of the statutes is amended to read:
224.74 (title) Department's Division's review of the operations of a loan solicitor, loan originator, mortgage broker or mortgage banker.
145,33 Section 33. 224.74 (1) of the statutes is repealed and recreated to read:
224.74 (1) Annual reports; audits. (a) Annual report. Except as provided in par. (b), each year, on a date specified by the division and in a form required by the division, a mortgage banker or mortgage broker shall submit to the division an annual report relating to the mortgage banker's or mortgage broker's operations during its most recently completed fiscal year.
(b) Audit requirement. Each year, no later than 6 months following the end of its most recently completed fiscal year, a mortgage banker or mortgage broker that qualified for registration under s. 224.72 (4) (a) 4. or (d) or (4m) (a) 3. or (b), shall submit a copy of an audit of the mortgage banker's or mortgage broker's operations during that fiscal year. An audit under this paragraph shall be conducted by an independent certified public accountant in accordance with generally accepted auditing standards. The financial statements in the audit report shall be prepared in accordance with generally accepted accounting principles.
(c) Audits requested by the division. The division may request that a mortgage banker or mortgage broker obtain an audit of the mortgage banker's or mortgage broker's operations if the division has reason to believe that the mortgage banker or mortgage broker may not have sufficient financial resources to meet its obligations to its clients or investors or to other persons directly affected by the activities conducted by the mortgage banker or mortgage broker under the certificate of registration granted by the division. If the division requests an audit under this paragraph, the mortgage banker or mortgage broker shall have the audit completed no later than 90 days after the date of the division's request. The mortgage banker or mortgage broker shall submit the audit report to the division no later than 5 days after the date on which the audit is completed. An audit under this paragraph shall be conducted by an independent certified public accountant in accordance with generally accepted auditing standards. The financial statements in the audit report shall be prepared in accordance with generally accepted accounting principles.
145,34 Section 34. 224.74 (2) (a) of the statutes is amended to read:
224.74 (2) (a) Conduct of examination and preparation of report. The department division may at any time, on its own motion or upon complaint, examine the books of account, records, condition and affairs of a mortgage banker, loan originator or loan solicitor mortgage broker registered under this subchapter. The department division shall prepare a report of each examination conducted under this section. As part of the examination or preparation of the report, the department division may examine under oath any of the members, officers, directors, agents, employes or customers of the mortgage banker, loan originator or loan solicitor mortgage broker. The department division may require a mortgage banker, loan originator or loan solicitor mortgage broker who is examined under this paragraph to pay to the department division a reasonable fee for the costs of conducting the examination. If the department requires a fee under this paragraph, the department shall establish the amount of the fee by rule.
145,35 Section 35. 224.74 (2) (b) of the statutes is amended to read:
224.74 (2) (b) Confidentiality. Examination reports and correspondence regarding the reports are confidential, except that the secretary division may release examination reports and correspondence in connection with a disciplinary proceeding conducted by the department division, a liquidation proceeding or a criminal investigation or proceeding.
145,36 Section 36. 224.75 (title) of the statutes is amended to read:
224.75 (title) Record-keeping requirements for mortgage bankers and loan solicitors mortgage brokers.
145,37 Section 37. 224.75 (1) (title) of the statutes is amended to read:
224.75 (1) (title) Required records; loan application or servicing documents.
145,38 Section 38. 224.75 (1) (a) of the statutes is amended to read:
224.75 (1) (a) Fee record system. A mortgage banker or loan solicitor mortgage broker shall establish and maintain a record system which shows all fees which a mortgage banker or mortgage broker charged a mortgage loan applicant and or a mortgagor. The record shall show the application or disposition of those fees.
145,39 Section 39. 224.75 (1) (b) (intro.) of the statutes is amended to read:
224.75 (1) (b) Loan application record system. (intro.) A mortgage banker or loan solicitor mortgage broker shall establish and maintain a record system containing all of the following information for each mortgage loan application:
145,40 Section 40. 224.75 (1) (c) (intro.) of the statutes is amended to read:
224.75 (1) (c) Loan application documents. (intro.) A mortgage banker or loan solicitor mortgage broker shall maintain for each mortgage loan application all of the following documents, if used by the mortgage banker or loan solicitor mortgage broker in connection with the mortgage loan application file:
145,41 Section 41. 224.75 (1) (d) of the statutes is created to read:
224.75 (1) (d) Loan servicing records and documents. A mortgage banker shall maintain for each mortgage loan serviced by the mortgage banker a copy of or a record of all correspondence relating to the loan.
145,42 Section 42. 224.75 (2) of the statutes is amended to read:
224.75 (2) Period of record retention. A mortgage banker or loan solicitor mortgage broker shall keep for at least 25 months copies of all deposit receipts, canceled checks, trust account records, the records which a mortgage banker or loan solicitor mortgage broker maintains under sub. (1) (c) or (d) and other relevant documents or correspondence received or prepared by the mortgage banker or loan solicitor mortgage broker in connection with a loan or loan application. The retention period begins on the date the loan is closed or, if the loan is not closed, the date of loan application. If the loan is serviced by a mortgage banker, the retention period commences on the date that the loan is paid in full. The mortgage banker or loan solicitor mortgage broker shall make the records available for inspection and copying by the department division. If the records are not kept within this state, the mortgage banker or loan solicitor mortgage broker shall, upon request of the department division, promptly send exact and complete copies of requested records to the department division.
145,43 Section 43. 224.75 (3) of the statutes is amended to read:
224.75 (3) Contents of credit and appraisal reports. (a) Credit report. If a mortgage banker or loan solicitor mortgage broker charges a loan applicant a separate fee for a credit report, the credit report shall consist, at a minimum, of a written statement indicating the name of the credit reporting agency which investigated the credit history of the applicant.
(b) Appraisal report. If a mortgage banker or loan solicitor mortgage broker charges a loan applicant a separate fee for an appraisal report, the appraisal report shall consist, at a minimum, of a written statement indicating the appraiser's opinion of the value of the property appraised for mortgage loan purposes, the basis for that opinion and the name of the person who conducted the appraisal. If requested by a loan applicant, a mortgage banker or mortgage broker shall provide the loan applicant with a copy of any written appraisal report held by the mortgage banker or mortgage broker, if the loan applicant paid a fee for the report and the report relates to residential real estate that the loan applicant owns or has agreed to purchase.
145,44 Section 44. 224.75 (4) of the statutes is amended to read:
224.75 (4) Responsibility for forms. A mortgage banker or loan solicitor mortgage broker is responsible for the preparation and correctness of all entries on forms, documents and records which are under the mortgage banker's or loan solicitor's mortgage broker's control and which are not dependent on information provided by the loan applicant or a 3rd party.
145,45 Section 45. 224.75 (5) of the statutes is amended to read:
224.75 (5) Accounting practices. A mortgage banker or loan solicitor mortgage broker shall maintain its books and records in accordance with generally accepted accounting principles.
145,46 Section 46. 224.76 of the statutes is amended to read:
224.76 (title) Mortgage banker, loan originator and loan solicitor mortgage broker trust accounts. A mortgage banker, loan originator or loan solicitor mortgage broker shall deposit in one or more trust accounts all funds other than nonrefundable fees which it receives on behalf of any person, pending disbursement of the funds in accordance with instructions from the person on whose behalf the funds are deposited. A mortgage banker or loan solicitor may mortgage broker shall maintain trust accounts in a bank, savings bank, savings and loan association or credit union which is authorized to do business in this state or which is federally chartered whose accounts are insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration. The mortgage banker or loan solicitor mortgage broker shall notify the department division of the location of its trust accounts and shall authorize the department to examine and audit any trust account as the department considers it necessary.
145,47 Section 47. 224.77 (title) of the statutes is amended to read:
224.77 (title) Discipline of mortgage bankers, loan originators and loan solicitors mortgage brokers.
145,48 Section 48. 224.77 (1) (intro.) of the statutes is amended to read:
224.77 (1)Prohibited conduct. (intro.) The department division may deny an application submitted to it under s. 224.72, or may revoke, suspend or limit the certificate of registration of a mortgage banker, loan originator or loan solicitor mortgage broker, or may reprimand a mortgage banker, loan originator or loan solicitor mortgage broker, if it finds that the mortgage banker, loan originator or loan solicitor mortgage broker did any of the following:
145,49 Section 49. 224.77 (1) (a) of the statutes is amended to read:
224.77 (1) (a) Made a material misstatement in an application for registration, or in information furnished to the department division.
145,50 Section 50. 224.77 (1) (e) of the statutes is amended to read:
224.77 (1) (e) Acted for more than one party in a transaction without the knowledge and consent of all parties on whose behalf the mortgage banker, loan originator or loan solicitor mortgage broker is acting.
145,51 Section 51. 224.77 (1) (f) of the statutes is amended to read:
224.77 (1) (f) Accepted a commission, money or other thing of value for performing an act as a loan originator unless the payment is from a mortgage banker or mortgage broker who is registered under s. 224.72 (3) as employing the loan originator.
145,52 Section 52. 224.77 (1) (h) of the statutes is amended to read:
224.77 (1) (h) Failed, within a reasonable time, to account for or remit any moneys coming into the mortgage banker's, loan originator's or loan solicitor's mortgage broker's possession which belong to another person.
145,53 Section 53. 224.77 (1) (i) of the statutes is amended to read:
224.77 (1) (i) Demonstrated a lack of competency to act as a mortgage banker, loan originator or loan solicitor mortgage broker in a way which safeguards the interests of the public.
145,54 Section 54. 224.77 (1) (k) of the statutes is amended to read:
224.77 (1) (k) Violated any provision of this subchapter, ch. 138 or any federal or state statute, rule or regulation which relates to practice as a mortgage banker, loan originator or loan solicitor mortgage broker.
145,55 Section 55. 224.77 (1) (L) of the statutes is amended to read:
224.77 (1) (L) Engaged in conduct which violates a standard of professional behavior which, through professional experience, has become established for mortgage bankers, loan originators or loan solicitors mortgage brokers.
145,56 Section 56. 224.77 (1) (o) of the statutes is amended to read:
224.77 (1) (o) In the course of practice as a mortgage banker, loan originator or loan solicitor mortgage broker, except in relation to housing designed to meet the needs of elderly individuals, treated a person unequally solely because of sex, race, color, handicap, sexual orientation, as defined in s. 111.32 (13m), religion, national origin, age or ancestry, the person's lawful source of income, or the sex or marital status of the person maintaining a household.
145,57 Section 57. 224.77 (1) (r) of the statutes is created to read:
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