LRBs0249/1
RJM:kmg:jf
2003 - 2004 LEGISLATURE
ASSEMBLY SUBSTITUTE AMENDMENT 1,
TO 2003 ASSEMBLY BILL 610
November 11, 2003 - Offered by Representative Jeskewitz.
AB610-ASA1,1,7
1An Act to renumber 224.71 (1c) and 224.72 (3);
to amend 15.09 (6), 224.72 (3)
2(title), 224.72 (5) (a), 224.72 (7m) (intro.), 224.77 (1m) (a), 224.80 (1) and 224.80
3(2) (a) 1.; and
to create 15.187, 224.71 (1ag), 224.71 (1d), 224.72 (3) (b), 224.72
4(3) (c), 224.72 (7) (d) and (e), 224.72 (7m) (am), 224.72 (7p), 224.755 and 224.79
5of the statutes;
relating to: qualifications of certain agents of mortgage
6bankers and mortgage brokers, consumer mortgage brokerage agreements,
7granting rule-making authority, and providing a penalty.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB610-ASA1,2,69
15.09
(6) Reimbursement for expenses. Members of a council shall not be
10compensated for their services, but
, except as otherwise provided in this subsection, 11members of councils created by statute shall be reimbursed for their actual and
1necessary expenses incurred in the performance of their duties, such reimbursement
2in the case of an elective or appointive officer or employee of this state who represents
3an agency as a member of a council to be paid by the agency which pays his or her
4salary.
Members of the loan originator council under s. 15.187 (1) may not be
5reimbursed for their actual and necessary expenses incurred in the performance of
6their duties.
AB610-ASA1,2,11
815.187 Same; councils. (1) Loan originator review council. There is
9created in the department of financial institutions a loan originator council. The
10council shall consist of the following members, appointed by the secretary of financial
11institutions for 4-year terms:
AB610-ASA1,2,1212
(a) Three persons who are loan originators registered under s. 224.72 (1m).
AB610-ASA1,2,1413
(b) Three persons who are agents of mortgage brokers registered under s.
14224.72 (1m) or agents of mortgage bankers registered under s. 224.72 (1m).
AB610-ASA1,2,1515
(c) The secretary of financial institutions or his or her designee.
AB610-ASA1,2,1817
224.71
(1ag) "Affiliate," when used in reference to any person, means another
18person who controls, is controlled by, or is under common control with the person.
AB610-ASA1, s. 4
19Section
4. 224.71 (1c) of the statutes is renumbered 224.71 (1e).
AB610-ASA1,2,2321
224.71
(1d) "Consumer" means a person other than an organization, as defined
22in s. 421.301 (28), who seeks or acquires mortgage brokerage services for personal,
23family, or household purposes.
AB610-ASA1, s. 6
24Section
6. 224.72 (3) (title) of the statutes is amended to read:
AB610-ASA1,3,2
1224.72
(3) (title)
Additional
requirement requirements for loan originator
2applicant.
AB610-ASA1, s. 7
3Section
7. 224.72 (3) of the statutes is renumbered 224.72 (3) (a).
AB610-ASA1,3,125
224.72
(3) (b) In addition to the requirements of sub. (2), each applicant for
6registration as a loan originator, other than an applicant employed by an affiliate of
7a credit union or of an entity described under s. 224.71 (3) (b) 1., shall pass a written
8examination, approved by the loan originator council, covering primary and
9subordinate mortgage financing transactions and the provisions of this subchapter.
10The examination shall be administered by the technical college system board, a
11professional trade association whose members include loan originators, or any other
12person approved by the division.
AB610-ASA1, s. 9
13Section
9. 224.72 (3) (c) of the statutes is created to read:
AB610-ASA1,3,1814
224.72
(3) (c) The employer of each applicant for registration as a loan
15originator, other than an applicant employed by an affiliate of a credit union or of an
16entity described under s. 224.71 (3) (b) 1., shall obtain a criminal history search
17relating to the applicant from the records maintained by the department of justice
18and submit the results of the search to the division.
AB610-ASA1,3,2420
224.72
(5) (a)
Loan originator. Except as provided in sub. (7m), upon receiving
21a properly completed application for registration as a loan originator and the fee
22specified in rules promulgated under sub. (8)
and upon an applicant's compliance
23with sub. (3) (a) and, if required, sub. (3) (b), the division may issue to the applicant
24a certificate of registration as a loan originator.
AB610-ASA1, s. 11
25Section
11. 224.72 (7) (d) and (e) of the statutes are created to read:
AB610-ASA1,4,8
1224.72
(7) (d) 1. Except as provided in subd. 2., an applicant for renewal of a
2certificate of registration as a loan originator, other than an applicant employed by
3an affiliate of a credit union or of an entity described under s. 224.71 (3) (b) 1., shall,
4as part of the application, submit evidence that is satisfactory to the division that,
5during the 2 years preceding the date of application, the applicant has successfully
6completed at least 16 hours of education approved by the loan originator council
7covering primary and subordinate mortgage financing transactions and the
8provisions of this subchapter.
AB610-ASA1,4,179
2. No later than June 30 of each year, the technical college system board, a
10professional trade association whose members include loan originators, or any other
11person approved by the division shall administer an examination or series of
12examinations, approved by the loan originator council, on the educational subjects
13required under subd. 1. Any applicant who, as part of the application, submits
14evidence that is satisfactory to the division that the applicant has passed the
15examination or series of examinations under this subdivision during the 2 years
16immediately preceding the date of application is not required to comply with subd.
171.
AB610-ASA1,4,2218
(e) If an applicant for renewal of a certificate of registration as a loan originator
19has changed employers since his or her criminal history was last searched under this
20paragraph or sub. (3) (c), the applicant's current employer shall obtain a criminal
21history search relating to the applicant from the records maintained by the
22department of justice and submit the results of the search to the division.
AB610-ASA1, s. 12
23Section
12. 224.72 (7m) (intro.) of the statutes is amended to read:
AB610-ASA1,5,3
1224.72
(7m) Denial of application for issuance or renewal of registration. 2(intro.) The
department division may not issue or renew a certificate of registration
3under this section if any of the following applies:
AB610-ASA1,5,85
224.72
(7m) (am) The information provided to the division under sub. (3) (c)
6or (7) (e) indicates that the applicant has been convicted of a felony and, as a result
7of the conviction, the applicant represents an unreasonable risk of violating this
8subchapter, in the opinion of the division.
AB610-ASA1,5,1410
224.72
(7p) Rules for approval of competency examinations and continuing
11education. The division shall promulgate rules establishing standards for the
12approval by the loan originator council of examinations in the law of mortgage
13banking and mortgage brokering under subs. (3) (b) and (7) (d) and the curricula of
14education under sub. (7) (d).
AB610-ASA1,5,21
16224.755 Continuing education and examination records. A loan
17originator shall keep records documenting compliance with s. 224.72 (7) (d) for at
18least 4 years. The technical college system board and any professional trade
19association or other person that administers examinations or provides education
20under s. 224.72 (7) (d) shall maintain records documenting attendance and
21examination performance for at least 4 years.
AB610-ASA1,5,2523
224.77
(1m) (a) The division may assess against a person who is registered
24under this chapter a forfeiture of not more than
$1,000 $2,000 for each violation
25enumerated under sub. (1) (a) to (o) or (r).
AB610-ASA1,6,10
2224.79 Consumer mortgage brokerage agreements and consumer
3disclosures. (1) Form and content of consumer mortgage brokerage agreements. 4Every contract between a mortgage broker and a consumer under which the
5mortgage broker agrees to provide brokerage services to the consumer shall be in
6writing, in the form prescribed by rule of the division, and shall contain all
7information required by rule of the division. The division shall promulgate rules to
8administer this subsection in consultation with the loan originator council under s.
915.187 (1). The division shall design these rules to facilitate the comparison of
10similar charges and total charges assessed by different mortgage brokers.
AB610-ASA1,6,22
11(2) Consumer disclosure statement. Before entering into a contract with a
12consumer to provide brokerage services, a mortgage broker shall give the consumer
13a copy of a consumer disclosure statement, explain the content of the statement, and
14ensure that the consumer initials or signs the statement, acknowledging that the
15consumer has read and understands the statement. The consumer disclosure
16statement shall contain a brief explanation of the relationship between the consumer
17and the mortgage broker under the proposed contract, a brief explanation of the
18manner in which the mortgage broker may be compensated under the proposed
19contract, and any additional information required by rule of the division. The
20division shall promulgate rules to administer this subsection in consultation with
21the loan originator council under s. 15.187 (1) and, by rule, shall specify the form and
22content of the consumer disclosure statement required under this subsection.
AB610-ASA1,7,224
224.80
(1) Penalties. A person who violates s. 224.72 (1m) may be fined not
25more than
$1,000 $2,000 or imprisoned for not more than
6 9 months or both. The
1district attorney of the county where the violation occurs shall enforce the penalty
2under this subsection on behalf of the state.
AB610-ASA1,7,64
224.80
(2) (a) 1. Twice the amount of the cost of loan origination connected with
5the transaction, except that the liability under this subdivision may not be less than
6$100 nor greater than
$1,000 $2,000 for each violation.
AB610-ASA1,7,118
(1)
Loan originator council; initial terms. Notwithstanding the length of
9terms specified for members of the loan originator council under section 15.187 (1)
10of the statutes, as created by this act, the initial members shall be appointed for the
11following terms:
