AB678,13,14 9(6) A registered entity may apply to renew its registered entity status by timely
10submitting, on forms and in the manner prescribed by the division, a completed
11renewal application and all required renewal fees. The division may not renew
12registered entity status under this section unless the division finds that the
13registered entity continues to meet the minimum standards for registration under
14this section.
AB678,13,16 15(7) If a registered entity fails to satisfy the minimum standards for renewal of
16its registration, its registration shall expire.
AB678,13,19 17(8) A registered entity shall cooperate with, and provide access to records and
18documents required by, the division to carry out examinations in accordance with s.
19224.74 (2) of mortgage loan originators that are sponsored by the registered entity.
AB678,37 20Section 37. 224.725 (1) of the statutes is amended to read:
AB678,14,321 224.725 (1) License required. Except as provided in s. 224.726 sub. (1m), an
22individual may not regularly engage in the business of a mortgage loan originator
23with respect to a residential mortgage loan, or use the title "mortgage loan
24originator," advertise, or otherwise portray himself or herself as a mortgage loan
25originator in this state, unless the individual has been issued by the division, and

1thereafter maintains, a license under this section. Each licensed mortgage loan
2originator shall register with, and maintain a valid unique identifier issued by, the
3nationwide mortgage licensing system and registry.
AB678,38 4Section 38. 224.725 (1m) (intro.), (a), (b), (f) and (g) 1., 2. and 3. of the statutes
5are created to read:
AB678,14,76 224.725 (1m) License exemptions. (intro.) The following individuals are not
7required to be licensed under this section:
AB678,14,88 (a) A registered mortgage loan originator.
AB678,14,129 (b) An employee of a federal, state, or local government agency or housing
10finance agency who acts as a mortgage loan originator only pursuant to his or her
11official duties as an employee of the federal, state, or local government agency or
12housing finance agency.
AB678,14,1613 (f) An employee of a bona fide nonprofit organization who acts as a mortgage
14loan originator only in connection with his or her work duties to the bona fide
15nonprofit organization and only with respect to residential mortgage loans with
16terms that are favorable to the borrower.
AB678,14,1817 (g) 1. These activities are considered by the Wisconsin Supreme Court to be part
18of the authorized practice of law within Wisconsin.
AB678,14,1919 2. These activities are carried out within an attorney-client relationship.
AB678,14,2120 3. The attorney carries out the activities in compliance with all applicable laws,
21rules, and ethics standards.
AB678,39 22Section 39. 224.725 (2) (d) of the statutes is repealed.
AB678,40 23Section 40. 224.725 (3) (b) of the statutes is amended to read:
AB678,15,924 224.725 (3) (b) The applicant has not been convicted of, or pled guilty or no
25contest to, a felony in a domestic, foreign, or military court during the 7-year period

1preceding the date of the application or, for a felony involving an act of fraud,
2dishonesty, breach of trust, or money laundering, at any time preceding the date of
3the application. This paragraph does not apply with With respect to any conviction
4for which the applicant has received a pardon or expungement of the conviction, the
5pardoned or expunged conviction shall not result in an automatic denial or
6revocation of a mortgage loan originator license. The division may consider the
7underlying crime, facts, or circumstances of a pardoned or expunged felony
8conviction when determining the eligibility of an applicant for licensure under this
9paragraph and par. (c)
.
AB678,41 10Section 41. 224.725 (4) (a) of the statutes is amended to read:
AB678,15,1611 224.725 (4) (a) Each mortgage loan originator shall be covered by a surety bond
12in accordance with this subsection. A surety bond of a mortgage banker or, mortgage
13broker, or registered entity meeting the requirements of par. (b) and s. 224.72 (4) (a)
142. or 224.722 (1) may satisfy the requirement under this paragraph for a mortgage
15loan originator who, under sub. (2) (d), identifies himself or herself as employed is
16sponsored
by the mortgage banker or, mortgage broker, or registered entity.
AB678,42 17Section 42. 224.726 (intro.), (1) (intro.), (2) and (3) of the statutes are repealed.
AB678,43 18Section 43. 224.726 (1) (a) and (b) of the statutes are renumbered 224.71 (13g)
19(a) and (b).
AB678,44 20Section 44. 224.726 (4) of the statutes is renumbered 224.725 (1m) (g) (intro.)
21and amended to read:
AB678,16,222 224.725 (1m) (g) (intro.) A licensed attorney who negotiates the terms of a
23residential mortgage loan on behalf of a client as an ancillary matter to the attorney's
24representation of the client, unless the attorney is compensated by a lender,
25mortgage broker, or mortgage loan originator or by any agent of a lender, mortgage

1broker, or mortgage loan originator.
undertakes activities described in s. 224.71 (6)
2if all of the following apply:
AB678,45 3Section 45. 224.73 (title) of the statutes is amended to read:
AB678,16,6 4224.73 (title) Relationship between mortgage loan originator and
5either a mortgage banker or a , mortgage broker, or registered entity;
6branch offices
.
AB678,46 7Section 46. 224.73 (1) of the statutes is amended to read:
AB678,16,118 224.73 (1) Responsibility for mortgage loan originator. A mortgage banker
9or, mortgage broker, or registered entity is responsible for, and shall supervise the
10acts of, a mortgage loan originator or any other person who otherwise acts on behalf
11of the mortgage banker or, mortgage broker, or registered entity.
AB678,47 12Section 47. 224.73 (2) of the statutes is amended to read:
AB678,16,1713 224.73 (2) Restriction on mortgage loan originator. (a) If the division
14suspends or revokes a mortgage banker's or mortgage broker's license or a registered
15entity's registration
, a mortgage loan originator may not act on behalf of that
16mortgage banker or, mortgage broker, or registered entity during the period of
17suspension or revocation.
AB678,16,2218 (b) A mortgage loan originator may act on behalf of only the mortgage banker
19or, mortgage broker, or registered entity with which that mortgage loan originator's
20license is associated in the records of the division, as designated under s. 224.725 (2)
21(d)
. A mortgage loan originator's license may only be associated with one mortgage
22banker or, mortgage broker, or registered entity at a time.
AB678,48 23Section 48. 224.73 (3) of the statutes is amended to read:
AB678,17,324 224.73 (3) Transfer by mortgage loan originator. (a) A licensed mortgage
25loan originator may apply, on forms and in the manner prescribed by the division,

1to transfer association to another licensed mortgage banker or mortgage broker or
2a registered entity
. The division shall promulgate rules establishing a fee for a
3transfer application under this subsection.
AB678,17,74 (b) A mortgage loan originator may not act on behalf of a mortgage banker or,
5mortgage broker, or registered entity until the mortgage loan originator's license
6association has been transferred to that mortgage banker or , mortgage broker, or
7registered entity
in the records of the division.
AB678,49 8Section 49. 224.73 (4) (title) and (a) of the statutes are repealed.
AB678,50 9Section 50. 224.73 (4) (b) of the statutes is renumbered 224.77 (1) (sn) and
10amended to read:
AB678,17,1611 224.77 (1) (sn) Any person originating a residential mortgage loan shall As a
12mortgage banker, mortgage broker, or mortgage loan originator, fail to
clearly place
13the person's his, her, or its unique identifier on all residential mortgage loan
14application forms, solicitations, and advertisements, including business cards or
15Web
, Internet sites, email signature blocks, and on all other documents specified by
16rule of the division.
AB678,51 17Section 51. 224.73 (5) of the statutes is created to read:
AB678,17,2218 224.73 (5) Mortgage loan originators and branch offices. (a) A mortgage
19loan originator shall be assigned to and work out of a licensed or registered office or
20branch office of the sponsoring mortgage banker, mortgage broker, or registered
21entity. This office shall either be the mortgage loan originator's residence or be
22within 100 miles of the mortgage loan originator's residence.
AB678,18,523 (b) At each branch office of a mortgage banker or registered entity at which
24residential mortgage loans are originated for the mortgage banker or registered
25entity or for another person, and at each branch office of a mortgage broker, there

1shall be at least one licensed mortgage loan originator assigned to and working out
2of the office. If an individual is identified as a branch manager for the office, either
3in the records of the division or in the records of the mortgage banker, mortgage
4broker, or registered entity, the individual must be licensed as a mortgage loan
5originator.
AB678,52 6Section 52. 224.74 (title) of the statutes is amended to read:
AB678,18,8 7224.74 (title) Division's review of the operations of a mortgage loan
8originator, mortgage broker,
or, mortgage banker, or registered entity.
AB678,53 9Section 53. 224.74 (1) (title) of the statutes is amended to read:
AB678,18,1010 224.74 (1) (title) Annual call Call reports; audits.
AB678,54 11Section 54. 224.74 (1) (a) of the statutes is amended to read:
AB678,18,1812 224.74 (1) (a) Annual Mortgage call report. Each year, by the date and in the
13form required by the nationwide mortgage licensing system and registry, each

14mortgage banker, mortgage broker, and mortgage loan originator licensed under this
15subchapter, and each registered entity, shall submit to the nationwide mortgage
16licensing system and registry an annual report reports of condition, which shall be
17in such form and
contain such information as the nationwide mortgage licensing
18system and registry may require.
AB678,55 19Section 55. 224.74 (1) (b) of the statutes is amended to read:
AB678,19,220 224.74 (1) (b) Audit requirement for mortgage bankers. Each year, no later than
216 months following the end of its most recently completed fiscal year, each mortgage
22banker or mortgage broker shall submit a copy of an audit of the mortgage banker's
23or mortgage broker's operations during that fiscal year. An audit under this
24paragraph shall be conducted by an independent certified public accountant in
25accordance with generally accepted auditing standards. The financial statements

1in the audit report shall be prepared in accordance with generally accepted
2accounting principles.
AB678,56 3Section 56. 224.74 (1) (bm) of the statutes is created to read:
AB678,19,124 224.74 (1) (bm) Reviewed financial statements for mortgage brokers. Each year,
5no later than 6 months following the end of its most recently completed fiscal year,
6each mortgage broker shall submit a copy of the mortgage broker's reviewed
7financial statements for the mortgage broker's operations during that fiscal year.
8The reviewed financial statements shall include a balance sheet, an income
9statement, and a written statement by an independent certified public accountant
10attesting that he or she has conducted his or her review in accordance with generally
11accepted accounting principles and professional standards of the American Institute
12of CPAs.
AB678,57 13Section 57. 224.75 (2) of the statutes is amended to read:
AB678,20,214 224.75 (2) Period of record retention. A mortgage banker or mortgage broker
15shall keep for at least 36 months, in an office of the mortgage banker or mortgage
16broker licensed under this subchapter but one that is not located in a residence, all
17books and records that, in the opinion of the division, will enable the division to
18determine whether the mortgage banker or mortgage broker is in compliance with
19the provisions of this subchapter. These books and records include copies of all
20deposit receipts, canceled checks, trust account records, the records which a
21mortgage banker or mortgage broker maintains under sub. (1) (c) or (d), and other
22relevant documents or correspondence received or prepared by the mortgage banker
23or mortgage broker in connection with a residential mortgage loan or residential
24mortgage loan application. The retention period begins on the date the residential
25mortgage loan is closed or, if the loan is not closed, the date of loan application. If

1the residential mortgage loan is serviced by a mortgage banker, the retention period
2commences on the date that the loan is paid in full.
AB678,58 3Section 58. 224.755 (4) (d) of the statutes is amended to read:
AB678,20,74 224.755 (4) (d) An individual may retake take a test 3 consecutive times, with
5each test retaken no less than retest occurring at least 30 days after the preceding
6test. If the individual fails 3 consecutive tests, the individual may not retake a test
7again for at least 6 months.
AB678,59 8Section 59. 224.755 (4) (e) of the statutes is amended to read:
AB678,20,149 224.755 (4) (e) If an individual previously licensed as a mortgage loan
10originator fails to maintain a valid license for a period of 5 years or longer, not taking
11into account any time during which the individual is a registered loan originator,
the
12individual shall retake the test under par. (a). For purposes of determining the
135-year period, the division shall not consider any period during which the individual
14is exempt from licensing under s. 224.726 (1).
AB678,60 15Section 60. 224.77 (title) of the statutes is amended to read:
AB678,20,18 16224.77 (title) Prohibited acts and practices, and discipline, of mortgage
17bankers, mortgage loan originators,
and mortgage brokers, and registered
18entities
.
AB678,61 19Section 61. 224.77 (1) (intro.) of the statutes is amended to read:
AB678,20,2420 224.77 (1) Prohibited acts and practices. (intro.) No mortgage banker,
21mortgage loan originator, or mortgage broker, or, with respect to pars. (f), (fg), (g),
22(gd), and (gh), registered entity,
and no member, officer, director, principal, partner,
23trustee, or other agent of a mortgage banker or, mortgage broker, or registered entity
24may do any of the following:
AB678,62 25Section 62. 224.77 (1) (f) of the statutes is amended to read:
AB678,21,5
1224.77 (1) (f) Accept a commission, money, or other thing of value for
2performing an act as a mortgage loan originator unless the payment is from a the
3mortgage banker or, mortgage broker, or registered entity with whom the mortgage
4loan originator's license is associated, as identified in the records of the division at
5the time the act is performed.
AB678,63 6Section 63. 224.77 (1) (fg) of the statutes is amended to read:
AB678,21,117 224.77 (1) (fg) As a mortgage banker or , mortgage broker, or registered entity,
8pay a commission, money, or other thing of value to any person for performing an act
9as a mortgage loan originator unless the mortgage loan originator's license is
10associated with the mortgage banker or, mortgage broker, or registered entity in the
11records of the division at the time the act is performed.
AB678,64 12Section 64. 224.77 (1) (g) of the statutes is amended to read:
AB678,21,1713 224.77 (1) (g) As a mortgage loan originator, represent or attempt to represent
14a mortgage banker or, mortgage broker , or registered entity other than the mortgage
15banker or, mortgage broker, or registered entity with whom the mortgage loan
16originator's license was associated, as identified in the records of the division at the
17time the representation or attempted representation occurs.
AB678,65 18Section 65. 224.77 (1) (gd) of the statutes is amended to read:
AB678,21,2119 224.77 (1) (gd) As a mortgage banker or , mortgage broker, or registered entity,
20permit a person who is not licensed under this subchapter to act as a mortgage loan
21originator on behalf of the mortgage banker or, mortgage broker, or registered entity.
AB678,66 22Section 66. 224.77 (1) (gh) of the statutes is amended to read:
AB678,22,223 224.77 (1) (gh) As a mortgage banker or , mortgage broker, or registered entity,
24permit a person whose mortgage loan originator license is not associated in the
25records of the division with the mortgage banker or, mortgage broker, or registered

1entity
to act as a mortgage loan originator on behalf of the mortgage banker or,
2mortgage broker, or registered entity.
AB678,67 3Section 67. 224.77 (1) (sm) and (sq) of the statutes are created to read:
AB678,22,54 224.77 (1) (sm) As a mortgage loan originator, fail to identify his or her name
5and sign the mortgage loan application for a loan originated by him or her.
AB678,22,76 (sq) As a mortgage banker, mortgage broker, or mortgage loan originator, use
7any solicitation or advertisement to which any of the following applies:
AB678,22,98 1. The solicitation or advertisement misrepresents that the provider is, or is
9affiliated with, any governmental entity or other organization.
AB678,22,1310 2. The solicitation or advertisement misrepresents that the product is or relates
11to a government benefit, or is endorsed, sponsored by, or affiliated with any
12government or government-related program, including through the use of formats,
13symbols, or logos that resemble those of such entity, organization, or program.
AB678,22,1614 3. The solicitation or advertisement does not clearly and conspicuously identify
15the name of the mortgage broker or mortgage banker or, if a mortgage loan originator
16is sponsored by a registered entity, the registered entity.
AB678,68 17Section 68. 224.77 (2m) (a) 1. (intro.), a. and b. of the statutes are amended
18to read:
AB678,22,2419 224.77 (2m) (a) 1. (intro.) In addition to any other authority provided to the
20division under this subchapter, if the division finds that a mortgage banker,
21mortgage loan originator, or mortgage broker has violated any provision of this
22subchapter or any rule promulgated by the division under this subchapter, or a
23registered entity has violated any applicable provision of this subchapter,
the
24division may do any of the following:
AB678,23,2
1a. Deny any application for initial issuance or renewal of a license or
2registration
.
AB678,23,43 b. Revoke, suspend, limit, or condition any license of the mortgage banker,
4mortgage loan originator, or mortgage broker or registration of the registered entity.
AB678,69 5Section 69. 224.83 of the statutes is repealed.
AB678,70 6Section 70. 943.80 (2) of the statutes is amended to read:
AB678,23,177 943.80 (2) "Financial institution" means a bank, as defined in s. 214.01 (1) (c),
8a savings bank, as defined in s. 214.01 (1) (t), a savings and loan association, a trust
9company, a credit union, as defined in s. 186.01 (2), a mortgage banker, as defined
10in s. 224.71 (3) (a), or a mortgage broker, as defined in s. 224.71 (4) (a), whether
11chartered under the laws of this state, another state or territory, or under the laws
12of the United States; a company that controls, is controlled by, or is under common
13control with a bank, a savings bank, a savings and loan association, a trust company,
14a credit union, a mortgage banker, or a mortgage broker; or a person licensed under
15s. 138.09, other than a person who agrees for a fee to hold a check for a period of time
16before negotiating or presenting the check for payment and other than a pawnbroker,
17as defined in s. 138.10 (1) (a).
AB678,23,1818 (End)
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