13. Place where comments are to be submitted and deadline for submission:
Comments may be submitted to the contact person shown below no later than the date on which the public hearing on this proposed rule order is conducted. Information as to the place, date and time of the public hearing will be published in the Wisconsin Administrative Register.
By mail: Marc Shovers, Assistant Chief Legal Counsel, Department of Financial Institutions, PO Box 8861, Madison, WI 53708-8861.
By delivery: Marc Shovers, Assistant Chief Legal Counsel, Department of Financial Institutions, 4822 Madison Yards Way, North Tower, Madison, WI 53705.
Rule Text
SECTTION 1. DFI-CU 51.01 is amended to read:
DFI-CU 51.01 (1) A credit union member shall be considered as is a person whose application has been approved in accordance with the provisions of as provided under the credit union’s by-laws. Said The person shall pay the entrance fee only if required to do so by resolution of the board of directors and shall subscribe for at least one share of stock and who shall. The person may either pay for this share in full upon credit union approval of the person’s application or may make the an initial payment thereon and shall and then pay the outstanding balance within 3 months.
SECTTION 2. DFI-CU 54.02 (5) (intro.) and (a) to (d) is amended to read:
DFI-CU 54.02 (5) (intro.) “Market value" means the most probable price, which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby where all of the following apply:
(a) Buyer and seller are typically motivated;.
(b) Both parties are well informed or well advised, and acting in what they consider their own best interests;.
(c) A reasonable time is allowed for exposure in the open market;.
(d) Payment is made in terms of cash in U.S. dollars or in terms of comparable financial arrangements comparable thereto; and.
SECTTION 3. DFI-CU 54.03 (1) (intro.) and (a) to (c) and (3) (a) to (d) is amended to read:
DFI-CU 54.03 (1) (intro.) Purchase money loans, excluding amounts financed for accident, health and credit life insurance premiums, may not exceed 90% of the market value of the subject real estate except if any of the following apply:
(a) The part of the loan that exceeds the 90% limitation is insured or guaranteed by a qualified private mortgage insurer;.
(b) The loan or the part of the loan that exceeds the 90% limitation is insured or guaranteed by an agency or instrumentality of a local, state or federal government;.
(c) The loan is to facilitate the sale of real estate owned by the credit union or real estate in foreclosure; or.
(3) (a) The date of closing;.
(b) The date of the first contractual principal and interest payment;.
(c) The date of any additional advance;.
(d) The date of any properly executed loan modification agreement; or.
SECTION 4. DFI-CU 54.05 (intro.) and (1) to (7) is renumbered 54.05 (1) (a) to (g) and (2) and, as renumbered, is amended to read:
DFI-CU 54.05 (1) Each real estate loan shall be supported by the following documents and information:
(1) (a) A note properly executed, together with the related mortgage properly executed and recorded.
(2) (b) Documentation establishing the quality and validity of the credit union's lien position by one of the following, for each category of loan:
(a) 1. For purchase money loans, one of the following:
1. a. A title policy in favor of the credit union covering its interest as mortgagee in the property; or.
2. b. An abstract showing title in the borrower's name and the credit union's mortgage, together with an attorney's opinion indicating the credit union's lien position.
(b) 2. For equity loans, one of the following:
1. a. An abstract of title and a signed report of title opinion by an attorney;.
2. b. A title insurance policy; or.
3. c. A final title letter report showing the status of the current lien.
(c) If the credit union has obtained the supporting documentation in accordance with par. (a) or (b) par. (b) 1. or 2., a subsequent extension of credit secured with the same real estate mortgage may be supported by a letter report from the title or abstract company, or a certified abstract showing the credit union's interest in the property as of the most recent extension of credit. No additional title documentation is required in connection with refinancing a loan on which no additional funds are advanced. Accrued interest debits, refinance charges and costs for insurance premiums are not considered additional advances. (3) (d) An appraisal or a valuation if required by NCUA rules and regulations 12 CFR Part 722. (4) (e) A copy of insurance policies, with a mortgage clause payable to the credit union, indicating all improvements on the real estate are insured against fire and casualty loss. The required insurance coverage shall be the lesser of the full replacement value of the improvements or the outstanding balance of the loan. Proof of insurance may be maintained through a third party contract.
(5) (f) Evidence of the status of the payment of real estate taxes acceptable to the board of directors as defined by policy.
(6) (g) Documentation of types of existing closed-end or open-end mortgages and balances or potential balances outstanding from all other lenders holding liens senior to the credit union mortgage.
(7) (2) The credit union shall maintain a general ledger accounting system which clearly segregates real estate loans for reporting and statutory calculation purposes.
SECTION 5. DFI-CU 56.01 is amended to read:
DFI-CU 56.01 Rules of procedure. The following rules of procedure shall govern all types of proceedings had before the credit union review board. In any case where the statute involved provides a procedure inconsistent with these rules, the statute shall govern to the extent of such inconsistency. If in any case the forms set out in these rules be found are not appropriate for a particular situation, parties may devise forms substantially similar to those herein prescribed, in this chapter to meet such situations.
SECTION 6. DFI-CU 56.06 is amended to read:
DFI-CU 56.06 Conduct of hearings; continuances; appearances; examination of witnesses. Continuances and adjournments may be granted by the board for cause shown. The appellant may appear in person or by an officer, regular employee, or attorney. Any other interested person may likewise so appear. Proceedings shall be in conformity to s. 220.035 (1) (c), Stats. Witnesses competent to take an oath shall be sworn by the chair of the board or the presiding officers and may be examined on behalf of the board by the chair or presiding officer or by a representative of the attorney general acting as counsel for the board, or with the permission of the chair or presiding officer, by any employee of the board or director or by any other interested party or their attorneys. Any interested party or any of his or her agents, officers, or employees may be examined adversely as prescribed by s. 885.14, 1973 906.11, Stats. In all other respects, proceedings shall be had as prescribed in ch. 227, Stats. SECTION 7. DFI-CU 56.07 is amended to read:
DFI-CU 56.07 Subpoenas. The board shall have the powers granted by s. 885.01 (4), 1973 Stats. SECTION 8. DFI-CU 56.09 is amended to read:
DFI-CU 56.09 Arguments. Except as provided in s. 227.49, Stats., arguments shall be submitted to the board in writing, unless otherwise ordered. Eight copies An electronic or paper copy of such written arguments shall be filed with the director who shall forthwith send a an electronic or paper copy to each member of the board. The time for filing arguments shall be fixed by the officer presiding at the hearing. SECTION 9. DFI-CU 56.10 is amended to read:
DFI-CU 56.10 The provisions of s. 263.28, 1973 802.09 (2) Stats., with reference to variances between the allegations and the proof, shall apply to proceedings under these rules. SECTION 10. DFI-CU 59 is repealed.
SECTION 11. DFI-CU 62.01 (1) (intro.), (a) and (b) are amended to read:
DFI-CU 62.01 (1) (intro.) The director may issue a supervisory order to cease and desist whenever he or she determines that a credit union is doing any of the following:
(a) Violating the provisions of its articles or by-laws, or the laws of this state, or the laws of the United States, or any lawful rule, order, or regulation promulgated by the director and the credit union review board; or .
(b) Violating any order of the director which may restrict, limit, or prohibit the credit union from engaging in any act or practice specified under s. 186.235 (11) (a) 1. to 9., Stats., inclusive; SECTION 12. DFI-CU 62.01 (1) (c) is renumbered 62.01 (1m) and as renumbered is amended to read:
(c) The (1m) Contents of order. A supervisory order could issued under sub. (1) may include but would not be limited to the declaration and/or payment of dividends on member savings; the granting or payout of member loans; the acceptance of payments on member savings; the payout of member requests for member savings; or any other portion of the business of a credit union. any of the following:
(a) The declaration of dividends on member savings.
(b) The payment of dividends on member savings.
(c) The granting of member loans.
(d) The payout of member loans.
(e) The acceptance of payments on member savings.
(f) The payout of member requests for member savings.
(g) Any other portion of the business of a credit union.
SECTION 13. DFI-CU 62.01 (2) is amended to read:
(2) The director shall deliver or cause to have delivered a formal written signed order to the board of directors of the credit union in which the facts known to the director are set forth and. The director shall demand the discontinuance of such the practice(s) or practices giving rise to the order and, whenever applicable, shall order the credit union to comply and/or or institute corrective action or both.
SECTION 14. DFI-CU 63.02 (4) is amended to read:
63.02 (4) Remote terminal. “Remote terminal" means a remote terminal as defined in s. 186.113 (15) (b), Stats., a remote service unit as defined in s. 215.13 (46) (a) 2., Stats., or a customer bank communications terminal as defined in s. 221.0303 (1), Stats. SECTION 15. DFI-CU 63.04 (2) (intro.) and (a) are amended to read:
