224.722 Registered entities. (1) A depository institution may apply for registered entity status with the division. The application shall be on forms and in the manner prescribed by the division and the applicant shall pay the same fee as that established by rule under s. 224.72 (8) for mortgage bankers. The application shall be accompanied by a commercial surety bond in the amount of $300,000 that is issued by a surety company authorized to do business in this state and is written on a form that is acceptable to the division.
(2) Upon the filing of an application for registered entity status and the payment of the required fee, the division shall make an investigation of the applicant. If the application is complete, and the division has no concerns regarding the applicant's character, general fitness, or financial responsibility, the division shall register the applicant as a registered entity.
(3) Each registered entity shall register with the division each branch office where a mortgage loan originator sponsored by the registered entity engages in business as a mortgage loan originator. Applications for branch office registration shall be made on forms and in the manner prescribed by the division and shall be accompanied by the same fee as that established by rule for branch offices of mortgage bankers.
(5) A depository institution's registered entity status, and the registration of all of its registered branch offices, expires on December 31 of each year.
(6) A registered entity may apply to renew its registered entity status, and the registration of all of its registered branch offices, by timely submitting, on forms and in the manner prescribed by the division, a completed renewal application for the registered entity and for each branch office, along with the applicable fee under sub. (1) or (3). The division may not renew registered entity status under this section unless the division finds that the registered entity continues to meet the minimum standards for registration under this section.
(7) If a registered entity fails to satisfy the minimum standards for renewal of its registration, its registration shall expire. If a registered entity fails to satisfy any requirement under sub. (6) for renewing its registration of a branch office, the registration for that branch office shall expire.
(8) A registered entity shall cooperate with, and provide access to records and documents required by, the division to carry out examinations in accordance with s. 224.74 (2) of mortgage loan originators that are sponsored by the registered entity.
360,37
Section
37. 224.725 (1) of the statutes is amended to read:
224.725 (1) License required. Except as provided in s. 224.726 sub. (1m), an individual may not regularly engage in the business of a mortgage loan originator with respect to a residential mortgage loan, or use the title "mortgage loan originator," advertise, or otherwise portray himself or herself as a mortgage loan originator in this state, unless the individual has been issued by the division, and thereafter maintains, a license under this section. Each licensed mortgage loan originator shall register with, and maintain a valid unique identifier issued by, the nationwide mortgage licensing system and registry.
360,38
Section
38. 224.725 (1m) (intro.), (a), (b), (f) and (g) 1., 2. and 3. of the statutes are created to read:
224.725 (1m) License exemptions. (intro.) The following individuals are not required to be licensed under this section:
(a) A registered mortgage loan originator.
(b) An employee of a federal, state, or local government agency or housing finance agency who acts as a mortgage loan originator only pursuant to his or her official duties as an employee of the federal, state, or local government agency or housing finance agency.
(f) An employee of a bona fide nonprofit organization who acts as a mortgage loan originator only in connection with his or her work duties to the bona fide nonprofit organization and only with respect to residential mortgage loans with terms that are favorable to the borrower.
(g) 1. These activities are considered by the Wisconsin Supreme Court to be part of the authorized practice of law within Wisconsin.
2. These activities are carried out within an attorney-client relationship.
3. The attorney carries out the activities in compliance with all applicable laws, rules, and ethics standards.
360,39
Section
39. 224.725 (2) (d) of the statutes is repealed.
360,40
Section
40. 224.725 (3) (b) of the statutes is amended to read:
224.725 (3) (b) The applicant has not been convicted of, or pled guilty or no contest to, a felony in a domestic, foreign, or military court during the 7-year period preceding the date of the application or, for a felony involving an act of fraud, dishonesty, breach of trust, or money laundering, at any time preceding the date of the application. This paragraph does not apply with With respect to any conviction for which the applicant has received a pardon or expungement of the conviction, the pardoned or expunged conviction shall not result in an automatic denial or revocation of a mortgage loan originator license. The division may consider the underlying crime, facts, or circumstances of a pardoned or expunged felony conviction when determining the eligibility of an applicant for licensure under this paragraph and par. (c).
360,41
Section
41. 224.725 (4) (a) of the statutes is amended to read:
224.725 (4) (a) Each mortgage loan originator shall be covered by a surety bond in accordance with this subsection. A surety bond of a mortgage banker or, mortgage broker, or registered entity meeting the requirements of par. (b) and s. 224.72 (4) (a) 2. or 224.722 (1) may satisfy the requirement under this paragraph for a mortgage loan originator who, under sub. (2) (d), identifies himself or herself as employed is sponsored by the mortgage banker or, mortgage broker, or registered entity.
360,42
Section
42. 224.726 (intro.), (1) (intro.), (2) and (3) of the statutes are repealed.
360,43
Section
43. 224.726 (1) (a) and (b) of the statutes are renumbered 224.71 (13g) (a) and (b).
360,44
Section
44. 224.726 (4) of the statutes is renumbered 224.725 (1m) (g) (intro.) and amended to read:
224.725 (1m) (g) (intro.) A licensed attorney who negotiates the terms of a residential mortgage loan on behalf of a client as an ancillary matter to the attorney's representation of the client, unless the attorney is compensated by a lender, mortgage broker, or mortgage loan originator or by any agent of a lender, mortgage broker, or mortgage loan originator. undertakes activities described in s. 224.71 (6) if all of the following apply:
360,45
Section
45. 224.73 (title) of the statutes is amended to read:
224.73 (title) Relationship between mortgage loan originator and either a mortgage banker or a , mortgage broker, or registered entity; branch offices.
360,46
Section
46. 224.73 (1) of the statutes is amended to read:
224.73 (1) Responsibility for mortgage loan originator. A mortgage banker or, mortgage broker, or registered entity is responsible for, and shall supervise the acts of, a mortgage loan originator or any other person who otherwise acts on behalf of the mortgage banker or
, mortgage broker, or registered entity.
360,47
Section
47. 224.73 (2) of the statutes is amended to read:
224.73 (2) Restriction on mortgage loan originator. (a) If the division suspends or revokes a mortgage banker's or mortgage broker's license or a registered entity's registration, a mortgage loan originator may not act on behalf of that mortgage banker or, mortgage broker, or registered entity during the period of suspension or revocation.
(b) A mortgage loan originator may act on behalf of only the mortgage banker or, mortgage broker, or registered entity with which that mortgage loan originator's license is associated in the records of the division, as designated under s. 224.725 (2) (d). A mortgage loan originator's license may only be associated with one mortgage banker or, mortgage broker, or registered entity at a time.
360,48
Section
48. 224.73 (3) of the statutes is amended to read:
224.73 (3) Transfer by mortgage loan originator. (a) A licensed mortgage loan originator may apply, on forms and in the manner prescribed by the division, to transfer association to another licensed mortgage banker or mortgage broker or a registered entity. The division shall promulgate rules establishing a fee for a transfer application under this subsection.
(b) A mortgage loan originator may not act on behalf of a mortgage banker or, mortgage broker
, or registered entity until the mortgage loan originator's license association has been transferred to that mortgage banker or
, mortgage broker, or registered entity in the records of the division.
360,49
Section
49. 224.73 (4) (title) and (a) of the statutes are repealed.
360,50
Section
50. 224.73 (4) (b) of the statutes is renumbered 224.77 (1) (sn) and amended to read:
224.77 (1) (sn) Any person originating a residential mortgage loan shall As a mortgage banker, mortgage broker, or mortgage loan originator, fail to clearly place the person's his, her, or its unique identifier on all residential mortgage loan application forms, solicitations, and advertisements, including business cards or Web, Internet sites, email signature blocks, and on all other documents specified by rule of the division.
360,51
Section
51. 224.73 (5) of the statutes is created to read:
224.73 (5) Mortgage loan originators and branch offices. (a) A mortgage loan originator shall be assigned to and work out of a licensed or registered office or branch office of the sponsoring mortgage banker, mortgage broker, or registered entity. This office shall either be the mortgage loan originator's residence or be within 100 miles of the mortgage loan originator's residence.
(b) At each branch office of a mortgage banker or registered entity at which residential mortgage loans are originated for the mortgage banker or registered entity or for another person, and at each branch office of a mortgage broker, there shall be at least one licensed mortgage loan originator assigned to and working out of the office. If an individual is identified as a branch manager for the office, either in the records of the division or in the records of the mortgage banker, mortgage broker, or registered entity, the individual must be licensed as a mortgage loan originator.
360,52
Section
52. 224.74 (title) of the statutes is amended to read:
224.74 (title) Division's review of the operations of a mortgage loan originator, mortgage broker, or, mortgage banker, or registered entity.
360,53
Section
53. 224.74 (1) (title) of the statutes is amended to read:
224.74 (1) (title) Annual call Call reports; audits.
360,54
Section
54. 224.74 (1) (a) of the statutes is amended to read:
224.74 (1) (a) Annual Mortgage call report. Each year, by the date and in the form required by the nationwide mortgage licensing system and registry, each mortgage banker, mortgage broker, and mortgage loan originator licensed under this subchapter, and each registered entity, shall submit to the nationwide mortgage licensing system and registry an annual report reports of condition, which shall be in such form and contain such information as the nationwide mortgage licensing system and registry may require.
360,55
Section
55. 224.74 (1) (b) of the statutes is amended to read:
224.74 (1) (b) Audit requirement for mortgage bankers. Each year, no later than 6 months following the end of its most recently completed fiscal year, each mortgage banker or mortgage broker 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.
360,56
Section
56. 224.74 (1) (bm) of the statutes is created to read:
224.74 (1) (bm) Reviewed financial statements for mortgage brokers. Each year, no later than 6 months following the end of its most recently completed fiscal year, each mortgage broker shall submit a copy of the mortgage broker's reviewed financial statements for the mortgage broker's operations during that fiscal year. The reviewed financial statements shall include a balance sheet, an income statement, and a written statement by an independent certified public accountant attesting that he or she has conducted his or her review in accordance with generally accepted accounting principles and professional standards of the American Institute of CPAs.
360,57
Section
57. 224.75 (2) of the statutes is amended to read:
224.75 (2) Period of record retention. A mortgage banker or mortgage broker shall keep for at least 36 months, in an office of the mortgage banker or mortgage broker licensed under this subchapter but one that is not located in a residence unless the residence is authorized as a principal office under s. 224.72 (2m) (b) 2., all books and records that, in the opinion of the division, will enable the division to determine whether the mortgage banker or mortgage broker is in compliance with the provisions of this subchapter. These books and records include copies of all deposit receipts, canceled checks, trust account records, the records which a mortgage banker or mortgage broker maintains under sub. (1) (c) or (d), and other relevant documents or correspondence received or prepared by the mortgage banker or mortgage broker in connection with a residential mortgage loan or residential mortgage loan application. The retention period begins on the date the residential mortgage loan is closed or, if the loan is not closed, the date of loan application. If the residential mortgage loan is serviced by a mortgage banker, the retention period commences on the date that the loan is paid in full.
360,58
Section
58. 224.755 (4) (d) of the statutes is amended to read:
224.755 (4) (d) An individual may retake take a test 3 consecutive times, with each test retaken no less than retest occurring at least 30 days after the preceding test. If the individual fails 3 consecutive tests, the individual may not retake a test again for at least 6 months.
360,59
Section
59. 224.755 (4) (e) of the statutes is amended to read:
224.755 (4) (e) If an individual previously licensed as a mortgage loan originator fails to maintain a valid license for a period of 5 years or longer, not taking into account any time during which the individual is a registered loan originator, the individual shall retake the test under par. (a). For purposes of determining the 5-year period, the division shall not consider any period during which the individual is exempt from licensing under s. 224.726 (1).
360,60
Section
60. 224.77 (title) of the statutes is amended to read:
224.77 (title) Prohibited acts and practices, and discipline, of mortgage bankers, mortgage loan originators, and mortgage brokers, and registered entities.
360,61
Section
61. 224.77 (1) (intro.) of the statutes is amended to read:
224.77 (1) Prohibited acts and practices. (intro.) No mortgage banker, mortgage loan originator, or mortgage broker, or, with respect to pars. (f), (fg), (g), (gd), and (gh), registered entity, and no member, officer, director, principal, partner, trustee, or other agent of a mortgage banker or, mortgage broker, or registered entity may do any of the following:
360,62
Section
62. 224.77 (1) (f) of the statutes is amended to read:
224.77 (1) (f) Accept a commission, money, or other thing of value for performing an act as a mortgage loan originator unless the payment is from a the mortgage banker or, mortgage broker, or registered entity with whom the mortgage loan originator's license is associated, as identified in the records of the division at the time the act is performed.
360,63
Section
63. 224.77 (1) (fg) of the statutes is amended to read:
224.77 (1) (fg) As a mortgage banker or
, mortgage broker, or registered entity, pay a commission, money, or other thing of value to any person for performing an act as a mortgage loan originator unless the mortgage loan originator's license is associated with the mortgage banker or, mortgage broker, or registered entity in the records of the division at the time the act is performed.
360,64
Section
64. 224.77 (1) (g) of the statutes is amended to read:
224.77 (1) (g) As a mortgage loan originator, represent or attempt to represent a mortgage banker or, mortgage broker, or registered entity other than the mortgage banker or, mortgage broker, or registered entity with whom the mortgage loan originator's license was associated, as identified in the records of the division at the time the representation or attempted representation occurs.
360,65
Section
65. 224.77 (1) (gd) of the statutes is amended to read:
224.77 (1) (gd) As a mortgage banker or
, mortgage broker, or registered entity, permit a person who is not licensed under this subchapter to act as a mortgage loan originator on behalf of the mortgage banker or, mortgage broker, or registered entity.
360,66
Section
66. 224.77 (1) (gh) of the statutes is amended to read:
224.77 (1) (gh) As a mortgage banker or
, mortgage broker, or registered entity, permit a person whose mortgage loan originator license is not associated in the records of the division with the mortgage banker or, mortgage broker, or registered entity to act as a mortgage loan originator on behalf of the mortgage banker or, mortgage broker, or registered entity.
360,67
Section
67. 224.77 (1) (sm) and (sq) of the statutes are created to read:
224.77 (1) (sm) As a mortgage loan originator, fail to identify his or her name and sign the mortgage loan application for a loan originated by him or her.
(sq) As a mortgage banker, mortgage broker, or mortgage loan originator, use any solicitation or advertisement to which any of the following applies:
1. The solicitation or advertisement misrepresents that the provider is, or is affiliated with, any governmental entity or other organization.
2. The solicitation or advertisement misrepresents that the product is or relates to a government benefit, or is endorsed, sponsored by, or affiliated with any government or government-related program, including through the use of formats, symbols, or logos that resemble those of such entity, organization, or program.
3. The solicitation or advertisement does not clearly and conspicuously identify the name of the mortgage broker or mortgage banker or, if a mortgage loan originator is sponsored by a registered entity, the registered entity.
360,68
Section
68. 224.77 (2m) (a) 1. (intro.), a. and b. of the statutes are amended to read:
224.77 (2m) (a) 1. (intro.) In addition to any other authority provided to the division under this subchapter, if the division finds that a mortgage banker, mortgage loan originator, or mortgage broker has violated any provision of this subchapter or any rule promulgated by the division under this subchapter, or a registered entity has violated any applicable provision of this subchapter, the division may do any of the following:
a. Deny any application for initial issuance or renewal of a license or registration.
b. Revoke, suspend, limit, or condition any license of the mortgage banker, mortgage loan originator, or mortgage broker or registration of the registered entity.
360,69
Section
69. 224.83 of the statutes is repealed.
360,70
Section
70. 943.80 (2) of the statutes is amended to read:
943.80 (2) "Financial institution" means a bank, as defined in s. 214.01 (1) (c), a savings bank, as defined in s. 214.01 (1) (t), a savings and loan association, a trust company, a credit union, as defined in s. 186.01 (2), a mortgage banker, as defined in s. 224.71 (3) (a), or a mortgage broker, as defined in s. 224.71 (4) (a), whether chartered under the laws of this state, another state or territory, or under the laws of the United States; a company that controls, is controlled by, or is under common control with a bank, a savings bank, a savings and loan association, a trust company, a credit union, a mortgage banker, or a mortgage broker; or a person licensed under s. 138.09, other than a person who agrees for a fee to hold a check for a period of time before negotiating or presenting the check for payment and other than a pawnbroker, as defined in s. 138.10 (1) (a).
