Date of enactment: April 20, 1998
1997 Assembly Bill 830 Date of publication*: May 4, 1998
* Section 991.11, Wisconsin Statutes 1995-96: Effective date of acts. "Every act and every portion of an act enacted by the legislature over the governor's partial veto which does not expressly prescribe the time when it takes effect shall take effect on the day after its date of publication as designated" by the secretary of state [the date of publication may not be more than 10 working days after the date of enactment].
1997 WISCONSIN ACT 145
An Act to repeal 224.70, 224.71 (1r) (b) and 224.72 (5) (b) 2.; to renumber and amend 224.71 (1r) (a), 224.71 (2), 224.72 (4) (intro.), 224.72 (4) (a), 224.72 (4) (b), 224.72 (4) (c) and 224.72 (5) (b) 1.; to amend subchapter II (title) of chapter 224 [precedes 224.70], 224.71 (3) (a) 3., 224.72 (title), 224.72 (1m), 224.72 (2) (intro.), 224.72 (2) (b), 224.72 (3), 224.72 (5) (a), 224.73, 224.74 (title), 224.74 (2) (a), 224.74 (2) (b), 224.75 (title), 224.75 (1) (title), 224.75 (1) (a), 224.75 (1) (b) (intro.), 224.75 (1) (c) (intro.), 224.75 (2), 224.75 (3), 224.75 (4), 224.75 (5), 224.76, 224.77 (title), 224.77 (1) (intro.), 224.77 (1) (a), 224.77 (1) (e), 224.77 (1) (f), 224.77 (1) (h), 224.77 (1) (i), 224.77 (1) (k), 224.77 (1) (L), 224.77 (1) (o), 224.77 (2), 224.77 (3), 224.77 (4), 224.77 (5) (a), 224.78, 224.80 (2) (intro.), 224.81, 224.82, 422.501 (2) (b) 8., 708.10 (1) (c) and 943.62 (2m); to repeal and recreate 224.72 (7), 224.72 (8) and 224.74 (1); and to create 224.71 (1b), 224.71 (1c), 224.71 (3) (b) 6., 224.71 (5), 224.72 (4) (a) 1. a. to d., 224.72 (4) (a) 3., 224.72 (4) (d), 224.72 (4m), 224.72 (4n), 224.72 (4r), 224.75 (1) (d), 224.77 (1) (r), 224.77 (1m), 224.77 (3m) and 224.77 (6) of the statutes; relating to: registration requirements for loan originators, mortgage bankers and mortgage brokers, providing an exemption from emergency rule procedures, granting rule-making authority and providing a penalty.
The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:
145,1 Section 1. Subchapter II (title) of chapter 224 [precedes 224.70] of the statutes is amended to read:
CHAPTER 224
SUBCHAPTER II
MORTGAGE BANKERS, LOAN
ORIGINATORS AND LOAN SOLICITORS
mortgage brokers
145,2 Section 2. 224.70 of the statutes is repealed.
145,3 Section 3. 224.71 (1b) of the statutes is created to read:
224.71 (1b) "Bona fide office" of a mortgage banker or mortgage broker means an office that meets all of the following conditions:
(a) Is located in this state.
(b) Has regular hours of operation.
(c) Is accessible to the public.
(d) Serves as an office for the transaction of business.
(e) Is staffed by an individual registered under this subchapter who is an employe of the mortgage banker or mortgage broker and is not shared with another business.
(f) Is separate from the offices of other entities.
(g) Contains the books and records of the mortgage banker or mortgage broker, or copies of the books and records, unless the mortgage banker or mortgage broker has agreed to furnish copies of its books and records, as soon as practicable, upon the request of the division.
145,4 Section 4. 224.71 (1c) of the statutes is created to read:
224.71 (1c) "Division" means the division of banking.
145,5 Section 5. 224.71 (1r) (a) of the statutes is renumbered 224.71 (1r) and amended to read:
224.71 (1r) "Loan originator" means a person who is not excluded by par. (b) and who, on behalf of a mortgage banker or mortgage broker, finds a loan or negotiates a land contract, loan or commitment for a loan.
145,6 Section 6. 224.71 (1r) (b) of the statutes, as affected by 1997 Wisconsin Act 27, is repealed.
145,7 Section 7. 224.71 (2) of the statutes, as affected by 1997 Wisconsin Act 27, is renumbered 224.71 (4), and 224.71 (4) (a) and (b) (intro.), as renumbered, are amended to read:
224.71 (4) (a) "Loan solicitor" "Mortgage broker" means a person who is not excluded by par. (b) and who, on behalf of a loan applicant or an investor and for commission, money or other thing of value, finds a loan or negotiates a land contract, loan or commitment for a loan or engages in table funding.
(b) (intro.) "Loan solicitor" "Mortgage broker" does not include any of the following:
145,8 Section 8. 224.71 (3) (a) 3. of the statutes is amended to read:
224.71 (3) (a) 3. Services loans or land contracts or provides escrow services, for another person and for commission, money or other thing of value.
145,9 Section 9. 224.71 (3) (b) 6. of the statutes is created to read:
224.71 (3) (b) 6. A person who originates, sells, or services loans only with the person's own funds for the person's own investment and the person has originated, sold or serviced no more than 4 loans during the previous 12 months.
145,10 Section 10. 224.71 (5) of the statutes is created to read:
224.71 (5) "Table funding" means a transaction in which a person conducts a loan closing in the person's name with funds provided by a 3rd party and the person assigns the loan to the 3rd party within 24 hours of the loan closing.
145,11 Section 11. 224.72 (title) of the statutes is amended to read:
224.72 (title) Registration of mortgage bankers, loan originators and loan solicitors mortgage brokers.
145,12 Section 12. 224.72 (1m) of the statutes is amended to read:
224.72 (1m) Registration required. A person may not act as a mortgage banker, loan originator or loan solicitor mortgage broker, use the title "mortgage banker", "loan originator" or "loan solicitor" " mortgage broker", or advertise or otherwise portray himself or herself as a mortgage banker, loan originator or loan solicitor mortgage broker, unless the person has been issued a certificate of registration from the department division.
145,13 Section 13. 224.72 (2) (intro.) of the statutes is amended to read:
224.72 (2)Applying for registration. (intro.) A person desiring to act as a mortgage banker, loan originator or loan solicitor mortgage broker shall apply for a certificate of registration to the department division on forms prescribed by the department division and shall pay the fee specified in rules promulgated under sub. (8) (a). An application shall satisfy all of the following:
145,14 Section 14. 224.72 (2) (b) of the statutes is amended to read:
224.72 (2) (b) Identity of partner, member or officer. If the applicant is a partnership, limited liability company or corporation, the application shall identify each partner, member or officer who will use the title "mortgage banker", "loan originator" or "loan solicitor" "mortgage broker".
145,15 Section 15. 224.72 (3) of the statutes is amended to read:
224.72 (3) Additional requirement for loan originator applicant. In addition to the requirements of sub. (2), an applicant for registration as a loan originator shall include in the application the name of the mortgage banker or mortgage broker who will employ the loan originator.
145,16 Section 16. 224.72 (4) (intro.) of the statutes is renumbered 224.72 (4) (a) (intro.) and amended to read:
224.72 (4) (a) (title) With a bona fide office. (intro.) In addition to the requirements of sub. (2), an applicant for registration as a mortgage banker who maintains a bona fide office shall do at least one of the following:
145,17 Section 17. 224.72 (4) (a) of the statutes is renumbered 224.72 (4) (a) 1. (intro.) and amended to read:
224.72 (4) (a) 1. `Approval by federal agency.' (intro.) Submit evidence which shows, to the department's division's satisfaction, that the federal department of housing and urban development has one or more of the following have approved the applicant as a mortgagee. :
145,18 Section 18. 224.72 (4) (a) 1. a. to d. of the statutes are created to read:
224.72 (4) (a) 1. a. The federal department of housing and urban development.
b. The Federal National Mortgage Association.
c. The Government National Mortgage Association.
d. The Federal Home Loan Mortgage Corporation.
145,19 Section 19. 224.72 (4) (a) 3. of the statutes is created to read:
224.72 (4) (a) 3. `Other bond or guarantee.' File a personal bond or 3rd-party guarantee in the amount of $25,000 in a form acceptable to the division and secured by one of the following forms of security:
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.
145,20 Section 20. 224.72 (4) (b) of the statutes is renumbered 224.72 (4) (a) 2. and amended to read:
224.72 (4) (a) 2. `File a bond.' File with the department a division a commercial surety bond which is in the amount of $25,000, is furnished issued by a surety company authorized to do business in this state and is approved by the department, secures the applicant's faithful performance of all duties and obligations of a mortgage banker, is payable to the division for the benefit of persons to whom the mortgage banker provided services as a mortgage banker, 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.
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