Changes Impacting Mortgage Loan Originators in Virginia
Virginia has enacted or reenacted four sections of its Code that impact to Mortgage Loan Originators.
§ 6.2-1712.1. Inactive mortgage loan originator licenses
Recently, Virginia enacted § 6.2-1712.1 which governs inactive mortgage loan originator licenses. The section explains that even after a qualified candidate is granted a mortgage loan originator license, they will remain inactive until the Commission updates their status in the Registry. The same applies to the renewal of a mortgage loan originator license. Similarly, if a licensed individual no longer meets Virginia surety bond requirements, their license will become inactive until the Registry is updated. It should be noted that if an individual’s mortgage loan originator license is inactive based on any of the above circumstances, they cannot operate as a mortgage loan originator until it has been determined that they satisfy Virginia surety bond requirements and their Registry status has been updated.
§ 6.2-406. Disclosure of terms of mortgage application
Additionally, Virginia amended and reenacted § 6.2-406. The section applies to any lender or broker who offers a first mortgage for an owner occupied, residential, 1 to 4 family dwelling. When the application is submitted, the mortgage loan originator must provide the candidate with a written statement that includes a good faith estimate of the processing time required to close (including time required for any local government inspections or functions). However, if a lender makes 10 or less of these loans in any 12 month period, they are exempt from this requirement.
§ 6.2-1607. Licenses; places of business; changes
Section 6.2-1607 governs mortgage licenses. It states that every license must include the name of the licensee and the address of all offices where business will be conducted. Licensees must operate under the name on the license and a license cannot be transferred or assigned by operation of law.
If a licensee wishes to open a new office, they must seek approval from the Commission via written application and a $150 nonrefundable fee. Generally, the Commission will approve the application unless, the applicant has not conducted business “efficiently, fairly, in the public interest, and accordance with law.” The application will be considered approved if; no adverse notice has been mailed by the Commission within 30 days of receipt of the application.
Licensees are further obligated to notify the Commissioner, in writing, if any approved office closes. This action must be taken within 10 days and include the “name, address and positon of each new senior officer, member, partner or director.”
Every license will remain active until expiration, surrender, revocation, or suspension. However, these conditions will not impact the preexisting legal rights and obligations of lenders and brokers. Expiration occurs at the end of the calendar year, unless renewed by the renewal date. Requests for renewal must be made through the Registry. If a license expires, a licensee may pursue reinstatement after expiration via renewal and a reinstatement fee.
§ 6.2-1610. Periodic reports
Section 6.2-1610 applies to periodic reports. Licensees must file periodic written reports with the Commissioner or the Registry related to their business and operations in whatever form and frequency prescribed. The Commissioner publishes an annual breakdown of these reports.
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