H. B. 3120
(By Delegates Michael, R. M. Thompson, Cann, H. White and Trump)
[Introduced February 21, 2003; referred to the
Committee on Banking and Insurance then the Judiciary.]
A BILL to amend article seventeen, chapter thirty-one of the code
of West Virginia, one thousand nine hundred thirty-one, as
amended, by adding thereto a new section designated seven-a;
and to amend and reenact section two, article six-c, chapter
forty-six-a, all relating to excluding mortgage brokers from
the Credit Services Organization Act and establishing
additional consumer protections in the mortgage brokers
licensing act.
Be it enacted by the Legislature of West Virginia:
That article seventeen, chapter thirty-one of the code of West
Virginia, one thousand nine hundred thirty-one, as amended;be
amended by adding thereto a new section, designated section seven-a
and that article six-c, chapter forty-six-a be amended and reenacted, all to read as follows:
ARTICLE 17. MORTGAGE LOANS
§31-17-7a. Disclosure Statement.
(a) At or before the time of application for a mortgage loan
by a prospective borrower, the mortgage broker or loan originator
shall provide the prospective borrower with a statement in writing,
signed by all parties, containing the following:
(1) Name, address, telephone number of all parties and the
brokers license number;
(2) A statement of who the mortgage broker represents;
(3) A statement of what the mortgage broker or loan originator
will be paid, including the terms and conditions of payment;
(4) A statement of total compensation to be paid for the loan
including fees paid by the borrower and fees paid to the mortgage
broker or loan originator by the lender;
(5) A statement that by signing the document both parties
agree to the terms of the contract or agreement and that the
information in the contract or agreement is accurate;
(6) The following statement "You are entitled to a copy of
this contract or agreement. Signing this contract or agreement does
not obligate you to obtain a mortgage loan through this mortgage
broker, nor is it a mortgage loan approval. You are acknowledging that you have read the entire document including your rights."; and
(7) A rights section containing a list of all rights of the
borrower including the following:
(A) The right to shop for the best loan and compare the
charges of different mortgage brokers and lenders;
(B) The right to be informed about the total cost of the loan
including the interest rate, points and other fees;
(C) The right to receive a Good Faith Estimate of all loan and
settlement charges prior to entering into a loan agreement or
paying any fees;
(D) The right to know what fees are not refundable if a loan
agreement is cancelled;
(E) The right to ask the mortgage broker to explain exactly
what the mortgage broker will do for the borrower;
(F) The right to know how much the mortgage broker is getting
paid by the borrower and the lender for the loan;
(G) The right to ask questions about the charges and loan
terms that are not understood;
(H) The right to a credit decision that is not based on race,
color, religion, national origin, sex, marital status, age, or
whether any income is from public assistance; and
(I) The right to know the reason a loan application is denied.
ARTICLE 6C. CREDIT SERVICES ORGANIZATIONS ACT.
§46A-6C-2. Credit services organization.
(a) A credit services organization is a person who, with
respect to the extension of credit by others and in return for the
payment of money or other valuable consideration, provides, or
represents that the person can or will provide, any of the
following services:
(1) Improving a buyer's credit record, history or rating;
(2) Obtaining an extension of credit for a buyer; or
(3) Providing advice or assistance to a buyer with regard to
subdivision (1) or (2) of this subsection.
(b) The following are exempt from this article:
(1) A person authorized to make loans or extension of credit
under the law of this state or the United States who is subject to
regulation and supervision by this state or the United States, or
a lender approved by the United States secretary of housing and
urban development for participation in a mortgage insurance program
under the National Housing Act (12 U.S.C. Section 1701 et seq.);
(2) A bank or savings and loan association whose deposit or
accounts are eligible for insurance by the federal deposit
insurance corporation or the federal savings and loan insurance
corporation, or a subsidiary of such a bank or savings and loan
association;
(3) A credit union doing business in this state;
(4) A nonprofit organization exempt from taxation under
Section 501(c)(3) of the Internal Revenue Code of 1986;
(5) A person licensed as a real estate broker or salesman
under the Real Estate Brokers License Act acting within the course
and scope of that license;
(6) A person licensed to practice law in this state acting
within the course and scope of the person's practice as an
attorney;
(7) A broker-dealer registered with the securities and
exchange commission or the commodity future trading commission
acting within the course and scope of that regulation;
(8) A consumer reporting agency;
(9) A person whose primary business is making loans secured by
liens on real property;
and
(10)A person licensed to practice public accounting in this
state acting within the course and scope of the person's practice
as an accountant;
and
(11) A mortgage broker licensed to practice as defined in the
provisions of article seventeen, chapter thirty-one of this code.
Note: The purpose of the bill is to exempt mortgage brokers
from the Credit Services Organization Act and to strengthen
consumer protections under the mortgage brokers licensing act.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
§§ 31-17-7a is new; therefore, strike-throughs and
underscoring have been omitted.
Email
Webmaster | © 2024 West Virginia Legislature **
