The Vermont Department of Financial Regulation has adopted regulations that update the rules for the licensing and regulation of mortgage brokers. The regulation sets forth standards on:

• Individuals who may be authorized to act as a mortgage loan originator (MLO) under the mortgage broker's license
• Steps that a mortgage broker must take to surrender a license
• The form of the contract between the mortgage broker and the prospective borrower
• The maintenance of a segregated account for funds collected form the prospective borrower by the mortgage broker
• The filing of quarterly mortgage call reports through the NMLS
• Prohibited mortgage broker activities

Notably, the regulation provides that all individuals authorized to act as an MLO under the mortgage broker's license must be assigned to a mortgage broker’s licensed location. Under the law, MLOs must live within a reasonable commuting distance from the licensed location to which they are assigned. In addition, the regulation requires that all authorized individuals be employees of the mortgage broker (i.e., a W-2) employee and not an independent contractor. It also prohibits an individual from acting as an MLO under more than one mortgage broker license at a time.

The regulation becomes effective on October 1, 2014.

Oklahoma Amends SAFE Act Effecting Mortgage Brokers, Lenders, and MLOs

The Oklahoma Department of Consumer Credit amended provisions of the Oklahoma SAFE Act regulating mortgage brokers, mortgage lenders, and mortgage loan originators (MLOs). Among its various rule clarifications, the amendment sets forth requirements for mortgage lenders regarding the application, bond, minimum net worth, criminal background checks of control persons, and credit reports of control persons. The amendment also specifies that an MLO must also be designated to oversee any mortgage lender’s activity that satisfies the definition of a mortgage broker under the Oklahoma SAFE Act.

In addition, the amendment requires that an MLO designated to oversee origination activities for a mortgage broker or mortgage lender may not serve as the designated MLO for any other mortgage broker, mortgage lender, or branch office. Note that the amendment mandates that a mortgage lender that maintains more than one business location must obtain a branch office license for each location.

The amendment became effective on September 12, 2014.

Oklahoma Revises Rules for Supervised Lenders

The Oklahoma Department of Consumer Credit amended its rules regulating supervised lenders. First, the amendment revises the Department’s licensing provision to state that a supervised lender application that is not reviewed for any failure on the part of the applicant will be deemed to be a withdrawal and not a denial. Second, the amendment removes a provision regarding the refund of certain fees if a licensee applicant fails to comply with the application process. Third, the amendment removes a provision that requires a licensee to return a license when an address change is requested or when a business location is closed.

The amendment became effective on September 12, 2014.