SB-0939, As Passed Senate, December 6, 2007
November 29, 2007, Introduced by Senator RICHARDVILLE and referred to the Committee on Finance.
A bill to amend 1987 PA 173, entitled
"Mortgage brokers, lenders, and servicers licensing act,"
by amending section 2 (MCL 445.1652), as amended by 2005 PA 113.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2. (1) A person shall not act as a mortgage broker,
mortgage lender, or mortgage servicer without first obtaining a
license or registering under this act, unless 1 or more of the
following apply:
(a) The person is solely performing services as an employee of
only 1 mortgage broker, mortgage lender, or mortgage servicer.
(b) The person is exempted from the act under section 25.
(c) The person is licensed as a class I licensee under the
consumer financial services act, 1988 PA 161, MCL 487.2051 to
487.2072.
(d) The individual is an employee of a professional employer
organization,
as that term is defined in section 4 of the single
business
tax act, 1975 PA 228, MCL 208.4 113
of the Michigan
business tax act, 2007 PA 36, MCL 208.1113, solely acting as a
residential mortgage originator of only 1 mortgage broker or
mortgage lender. The mortgage broker or mortgage lender shall do
all of the following:
(i) Direct and control the activities of the individual under
this act.
(ii) Be responsible for all activities of the individual and
assume responsibility for the individual’s actions that are covered
by the proof of financial responsibility deposit required under
section 4.
(2) A person that is licensed to make regulatory loans under
the regulatory loan act, 1939 PA 21, MCL 493.1 to 493.24, or is
licensed to make secondary mortgage loans under the secondary
mortgage loan act, 1981 PA 125, MCL 493.51 to 493.81, and is
registered with the commissioner shall file with the commissioner
an application for a license under section 3(1) or shall
discontinue all activities that are subject to this act.
(3) Unless a residential mortgage originator is otherwise
licensed or registered under this act, a residential mortgage
originator shall not receive directly or indirectly any
compensation, commission, fee, points, or other remuneration or
benefits from a mortgage broker, mortgage lender, or mortgage
servicer other than the employer of the residential mortgage
originator.
(4) Unless a residential mortgage originator is otherwise
licensed or registered under this act, a mortgage broker, mortgage
lender, or mortgage servicer shall not pay directly or indirectly
any compensation, commission, fee, points, or other remuneration or
benefits to a residential mortgage originator other than an
employee of the mortgage broker, mortgage lender, or mortgage
servicer. As used in this subsection and subsection (3),
"residential mortgage originator" means a person who assists
another person in obtaining a mortgage loan.
(5) A mortgage broker, mortgage lender, or mortgage servicer
that was exempt from regulation under this act and is a subsidiary
or affiliate of a depository financial institution or a depository
financial institution holding company that does not maintain a main
office or branch office in this state, shall register under section
6 or shall discontinue all activities subject to this act.
(6) Except for a state or nationally chartered bank, savings
bank, or an affiliate of a bank or savings bank, the person subject
to this act shall not include in its name or assumed name, the
words "bank", "banker", "banking", "banc", "bankcorp", "bancorp",
or any other words or phrases that would imply that the person is a
bank, is engaged in the business of banking, or is affiliated with
a bank or savings bank. It is not a violation of this subsection
for a licensee or registrant to use the term "mortgage banker" or
"mortgage banking" in its name or assumed name. A person subject to
this act whose name or assumed name on January 1, 1995 contained a
word prohibited by this section may continue to use the name or
assumed name.