2016 North Dakota Century Code Title 13 Debtor and Creditor Relationship Chapter 13-10 Mortgage Loan Originators
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CHAPTER 13-10
MORTGAGE LOAN ORIGINATORS
13-10-01. Purpose.
The purpose of this chapter is to protect consumers seeking mortgage loans and to ensure
that the mortgage lending industry is operating without unfair, deceptive, and fraudulent
practices on the part of mortgage loan originators.
13-10-02. Definitions.
For purposes of this chapter:
1. "Depository institution" has the same meaning as is currently defined under section 3
of the Federal Deposit Insurance Act and includes any credit union.
2. "Federal banking agencies" means the board of governors of the federal reserve
system, the comptroller of the currency, the director of the office of thrift supervision,
the national credit union administration, and the federal deposit insurance corporation.
3. "Immediate family member" means a spouse, child, sibling, parent, grandparent, or
grandchild. This includes stepparents, stepchildren, stepsiblings, and adoptive
relationships.
4. "Individual" means a natural person.
5. "Loan processor or underwriter" means an individual who performs clerical or support
duties as an employee at the direction of and subject to the supervision and instruction
of a person licensed, or exempt from licensing, under this chapter.
a. For purposes of this subsection, "clerical or support duties" may include
subsequent to the receipt of an application:
(1) The receipt, collection, distribution, and analysis of information common for
the processing or underwriting of a residential mortgage loan; and
(2) Communicating with a consumer to obtain the information necessary for the
processing or underwriting of a loan, to the extent that such communication
does not include offering or negotiating loan rates or terms, or counseling
consumers about residential mortgage loan rates or terms.
b. An individual engaging solely in loan processor or underwriter activities shall not
represent to the public, through advertising or other means of communicating or
providing information, including the use of business cards, stationery, brochures,
signs, rate lists, or other promotional items, that such individual can or will
perform any of the activities of a mortgage loan originator.
6. "Mortgage loan originator":
a. Means an individual who for compensation or gain or in the expectation of
compensation or gain:
(1) Takes a residential mortgage loan application; or
(2) Offers or negotiates terms of a residential mortgage loan;
b. Does not include an individual engaged solely as a loan processor or underwriter
except as otherwise provided in subsection 4 of section 13-10-03;
c. Does not include a person or entity that only performs real estate brokerage
activities and is licensed or registered in accordance with North Dakota law,
unless the person or entity is compensated by a lender, a mortgage broker, or
other mortgage loan originator or by any agent of such lender, mortgage broker,
or other mortgage loan originator; and
d. Does not include a person or entity solely involved in extensions of credit relating
to timeshare plans, as that term is defined in 11 U.S.C. 101(53D).
7. "Nationwide mortgage licensing system and registry" means a mortgage licensing
system developed and maintained by the conference of state bank supervisors and
the American association of residential mortgage regulators for the licensing and
registration of licensed mortgage loan originators.
8. "Nontraditional mortgage product" means any mortgage product other than a
thirty-year fixed rate mortgage.
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"Person" means a natural person, corporation, company, limited liability company,
partnership, or association.
"Real estate brokerage activity" means any activity that involves offering or providing
real estate brokerage services to the public, including:
a. Acting as a real estate agent or real estate broker for a buyer, seller, lessor, or
lessee of real property;
b. Bringing together parties interested in the sale, purchase, lease, rental, or
exchange of real property;
c. Negotiating, on behalf of any party, any portion of a contract relating to the sale,
purchase, lease, rental, or exchange of real property, other than in connection
with providing financing with respect to any such transaction;
d. Engaging in any activity for which a person engaged in the activity is required to
be registered or licensed as a real estate agent or real estate broker under any
applicable law; and
e. Offering to engage in any activity, or act in any capacity, described in this
subsection.
"Registered mortgage loan originator" means any individual who:
a. Meets the definition of mortgage loan originator and is an employee of:
(1) A depository institution;
(2) A subsidiary that is:
(a) Owned and controlled by a depository institution; and
(b) Regulated by a federal banking agency; or
(3) An institution regulated by the farm credit administration; and
b. Is registered with, and maintains a unique identifier through, the nationwide
mortgage licensing system and registry.
"Residential mortgage loan" means any loan primarily for personal, family, or
household use that is secured by a mortgage, deed of trust, or other equivalent
consensual security interest on a dwelling, as defined in section 103(v) of the Truth in
Lending Act, or residential real estate upon which is constructed or intended to be
constructed such a dwelling.
"Residential real estate" means any real property located in North Dakota, upon which
is constructed or intended to be constructed a dwelling.
"Unique identifier" means a number or other identifier assigned by protocols
established by the nationwide mortgage licensing system and registry.
13-10-03. License and registration required.
1. An individual, unless specifically exempted from this chapter under subsection 2, shall
not engage in the business of a mortgage loan originator with respect to any dwelling
located in this state without first obtaining and maintaining annually a license under
this chapter. Each licensed mortgage loan originator must register with and maintain a
valid unique identifier issued by the nationwide mortgage licensing system and
registry.
2. The following are exempt from this chapter:
a. Registered mortgage loan originators, when acting for an entity described in
subdivision a of subsection 11 of section 13-10-02 are exempt from this chapter.
b. Any individual who offers or negotiates terms of a residential mortgage loan with
or on behalf of an immediate family member of the individual.
c. Any individual who offers or negotiates terms of a residential mortgage loan
secured by a dwelling that served as the individual's residence.
d. A licensed attorney who negotiates the terms of a residential mortgage loan on
behalf of a client as an ancillary matter to the attorney's representation of the
client, unless the attorney is compensated by a lender, a mortgage broker, or
other mortgage loan originator or by any agent of such lender, mortgage broker,
or other mortgage loan originator.
e. An individual who is an employee of a federal, state, or local government agency
or housing finance agency and who acts as a loan originator solely pursuant to
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that individual's official duties as an employee of the federal, state, or local
government agency or housing finance agency in compliance with title 12, Code
of Federal Regulations, part 1008, section 1008.103(e)(6).
f. An individual who is an employee of a bona fide nonprofit organization who acts
as a loan originator solely with respect to that individual's work duties to the
bona fide nonprofit organization, and who acts as a loan originator solely with
respect to residential mortgage loans with terms that are favorable to the
borrower in compliance with title 12, Code of Federal Regulations, part 1008,
section 1008.103(e)(7).
A loan processor or underwriter who is an independent contractor may not engage in
the activities of a loan processor or underwriter unless such independent contractor
loan processor or underwriter obtains and maintains a license under subsection 1.
Each independent contractor loan processor or underwriter licensed as a mortgage
loan originator must have and maintain a valid unique identifier issued by the
nationwide mortgage licensing system and registry.
To implement an orderly and efficient licensing process, the commissioner may
establish licensing rules or regulations and interim procedures for licensing and
acceptance of applications. For previously registered or licensed individuals, the
commissioner may establish expedited review and licensing procedures.
13-10-04. State license and registration application and issuance.
1. Applicants for a license shall apply in a form as prescribed by the commissioner. Each
such form must contain content as set forth by rule, regulation, instruction, or
procedure of the commissioner and may be changed or updated as necessary by the
commissioner in order to carry out the purposes of this chapter.
2. To fulfill the purposes of this chapter, the commissioner may establish relationships or
contracts with the nationwide mortgage licensing system and registry or other entities
designated by the nationwide mortgage licensing system and registry to collect and
maintain records and process transaction fees or other fees related to licensees or
other persons subject to this chapter.
3. In connection with an application for licensing as a mortgage loan originator, the
applicant shall, at a minimum, furnish to the nationwide mortgage licensing system and
registry information concerning the applicant's identity, including:
a. Fingerprints for submission to the federal bureau of investigation and any
governmental agency or entity authorized to receive such information for a state,
national, and international criminal history background check; and
b. Personal history and experience in a form prescribed by the nationwide mortgage
licensing system and registry, including the submission of authorization for the
nationwide mortgage licensing system and registry and the commissioner to
obtain:
(1) An independent credit report obtained from a consumer reporting agency
described in section 603(p) of the Fair Credit Reporting Act; and
(2) Information related to any administrative, civil, or criminal findings by any
governmental jurisdiction.
4. For the purposes of this section and in order to reduce the points of contact which the
federal bureau of investigation may have to maintain for purposes of subsection 3, the
commissioner may use the nationwide mortgage licensing system and registry as a
channeling agent for requesting information from and distributing information to the
department of justice or any governmental agency.
5. For the purposes of this section and in order to reduce the points of contact which the
commissioner may have to maintain for purposes of subsection 3, the commissioner
may use the nationwide mortgage licensing system and registry as a channeling agent
for requesting and distributing information to and from any source so directed by the
commissioner.
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13-10-05. Issuance of license.
The commissioner shall not issue a mortgage loan originator license unless the
commissioner makes at a minimum the following findings:
1. The applicant has never had a mortgage loan originator license revoked in any
governmental jurisdiction, except that a subsequent formal vacation of such revocation
shall not be deemed a revocation.
2. The applicant has not been convicted of, or pled guilty or nolo contendere to, a felony
in a domestic, foreign, or military court:
a. During the seven-year period preceding the date of the application for licensing
and registration; or
b. At any time preceding such date of application, if such felony involved an act of
fraud, dishonesty, or a breach of trust, or money laundering;
c. Provided that any pardon of a conviction shall not be a conviction for purposes of
this subsection.
3. a. The applicant has demonstrated financial responsibility, character, and general
fitness such as to command the confidence of the community and to warrant a
determination that the mortgage loan originator will operate honestly, fairly, and
efficiently within the purposes of this chapter.
b. For purposes of this subsection, a person has shown that that person is not
financially responsible when that person has shown a disregard in the
management of that person's own financial condition. A determination that an
individual has not shown financial responsibility may include:
(1) Current outstanding judgments, except judgments solely as a result of
medical expenses;
(2) Current outstanding tax liens or other government liens and filings;
(3) Foreclosures within the past three years; and
(4) A pattern of seriously delinquent accounts within the past three years.
4. The applicant has completed the prelicensing education requirement described in
section 13-10-06.
5. The applicant has passed a written test that meets the test requirement described in
section 13-10-07.
6. The applicant has met the net worth and surety bond requirements under section
13-10-13.
13-10-06. Prelicensing and relicensing education of loan originators.
1. To meet the prelicensing education requirement referred to in subsection 4 of section
13-10-05, a person shall complete at least twenty hours of education approved in
accordance with subsection 2, which must include at least:
a. Three hours of federal law and regulations;
b. Three hours of ethics, which shall include instruction on fraud, consumer
protection, and fair lending issues; and
c. Two hours of training related to lending standards for the nontraditional mortgage
product marketplace.
2. For purposes of subsection 1, prelicensing education courses must be reviewed and
approved by the nationwide mortgage licensing system and registry based upon
reasonable standards. Review and approval of a prelicensing education course must
include review and approval of the course provider.
3. Nothing in this section precludes any prelicensing education course, as approved by
the nationwide mortgage licensing system and registry, which is provided by the
employer of the applicant or an entity that is affiliated with the applicant by an agency
contract or any subsidiary or affiliate of such employer or entity.
4. Prelicensing education may be offered in a classroom, online, or by any other means
approved by the nationwide mortgage licensing system and registry.
5. The prelicensing education requirements approved by the nationwide mortgage
licensing system and registry in subsection 1 for any state shall be accepted as credit
toward completion of prelicensing education requirements in North Dakota.
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6.
A person previously licensed under this chapter after the effective date of this chapter
applying to be licensed again must prove that that person has completed all of the
continuing education requirements for the year in which the license was last held.
13-10-07. Testing of loan originators.
1. In order to meet the written test requirement referred to in subsection 5 of section
13-10-05, an individual must pass, in accordance with the standards established under
this subsection, a qualified written test developed by the nationwide mortgage
licensing system and registry and administered by a test provider approved by the
nationwide mortgage licensing system and registry based upon reasonable standards.
2. A written test shall not be treated as a qualified written test for purposes of
subsection 1 unless the test adequately measures the applicant's knowledge and
comprehension in appropriate subject areas, including:
a. Ethics;
b. Federal law and regulation pertaining to mortgage origination;
c. State law and regulation pertaining to mortgage origination; and
d. Federal and state law and regulation, including instruction on fraud, consumer
protection, the nontraditional mortgage marketplace, and fair lending issues.
3. Nothing in this section prohibits a test provider approved by the nationwide mortgage
licensing system and registry from providing a test at the location of the employer of
the applicant or the location of any subsidiary or affiliate of the employer of the
applicant or the location of any entity with which the applicant holds an exclusive
arrangement to conduct the business of a mortgage loan originator.
4. a. An individual shall not be considered to have passed a qualified written test
unless the individual achieves a test score of not less than seventy-five percent
correct answers to questions.
b. An individual may retake a test three consecutive times, with each consecutive
taking occurring at least thirty days after the preceding test.
c. After failing three consecutive tests, an individual shall wait at least six months
before taking the test again.
d. A licensed mortgage loan originator who fails to maintain a valid license for a
period of five years or longer shall retake the test, not taking into account any
time during which individual is a registered mortgage loan originator.
13-10-08. Standards for license renewal.
1. The minimum standards for license renewal for mortgage loan originators include the
following:
a. The mortgage loan originator continues to meet the minimum standards for
license issuance under section 13-10-05.
b. The mortgage loan originator has satisfied the annual continuing education
requirements described in section 13-10-09.
c. The mortgage loan originator has paid all required fees for renewal of the license.
2. The license of a mortgage loan originator failing to satisfy the minimum standards for
license renewal shall expire. The commissioner may adopt procedures for the
reinstatement of expired licenses consistent with the standards established by the
nationwide mortgage licensing system and registry.
13-10-09. Continuing education for mortgage loan originators.
1. To meet the annual continuing education requirements referred to in section 13-10-08,
a licensed mortgage loan originator shall complete at least eight hours of education
approved in accordance with subsection 2, which must include at least:
a. Three hours of federal law and regulations;
b. Two hours of ethics, which shall include instruction on fraud, consumer
protection, and fair lending issues; and
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Two hours of training related to lending standards for the nontraditional mortgage
product marketplace.
For purposes of subsection 1, continuing education courses shall be reviewed and
approved by the nationwide mortgage licensing system and registry based upon
reasonable standards. Review and approval of a continuing education course must
include review and approval of the course provider.
Nothing in this section precludes any education course, as approved by the nationwide
mortgage licensing system and registry, which is provided by the employer of the
mortgage loan originator or an entity that is affiliated with the mortgage loan originator
by an agency contract or any subsidiary or affiliate of such employer or entity.
Continuing education may be offered in a classroom, online, or by any other means
approved by the nationwide mortgage licensing system and registry.
For a licensed mortgage loan originator:
a. Except as allowed by subsection 2 of section 13-10-08 and subsection 9 of this
section, an individual may only receive credit for a continuing education course in
the year in which the course is taken; and
b. An individual may not take the same approved course in the same or successive
years to meet the annual requirements for continuing education.
A licensed mortgage loan originator who is an approved instructor of an approved
continuing education course may receive credit for the licensed mortgage loan
originator's own annual continuing education requirement at the rate of two hours
credit for every one hour taught.
A person having successfully completed the education requirements approved by the
nationwide mortgage licensing system and registry in subsection 1 for any state shall
be accepted as credit toward completion of continuing education requirements in North
Dakota.
A licensed mortgage loan originator who subsequently becomes unlicensed must
complete the continuing education requirements for the last year in which the license
was held prior to issuance of a new or renewed license.
A person meeting the requirements of subdivisions a and c of subsection 1 of section
13-10-08 may make up any deficiency in continuing education as established by rule
or regulation of the commissioner.
13-10-10. Authority to require license.
In addition to any other duties imposed upon the commissioner by law, the commissioner
shall require mortgage loan originators to be licensed and registered through the nationwide
mortgage licensing system and registry. To carry out this requirement, the commissioner may
participate in the nationwide mortgage licensing system and registry. For this purpose, the
commissioner may establish by rule requirements as necessary, including:
1. Background checks for:
a. Criminal history through fingerprint or other databases;
b. Civil or administrative records;
c. Credit history; or
d. Any other information as deemed necessary by the nationwide mortgage
licensing system and registry;
2. The payment of fees to apply for or renew licenses through the nationwide mortgage
licensing system and registry;
3. The setting or resetting as necessary of renewal or reporting dates; and
4. Requirements for amending or surrendering a license or any other such activities as
the commissioner deems necessary for participation in the nationwide mortgage
licensing system and registry.
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13-10-11. Nationwide mortgage licensing system and registry information challenge
process.
The commissioner shall establish a process by which mortgage loan originators may
challenge information entered into the nationwide mortgage licensing system and registry by the
commissioner.
13-10-12. Enforcement authorities, violations, and penalties.
1. To ensure the effective supervision and enforcement of this chapter the commissioner
may:
a. Deny, suspend, revoke, condition, or decline to renew a license for a violation of
this chapter, rules or regulations issued under this chapter or order or directive
entered under this chapter.
b. Deny, suspend, revoke, condition, or decline to renew a license if an applicant or
licensee fails at any time to meet the requirements of section 13-10-05 or
13-10-08, or withholds information or makes a material misstatement in an
application for a license or renewal of a license.
c. Order restitution against persons subject to this chapter for violations of this
chapter.
d. Impose fines on persons subject to this chapter pursuant to subsections 2, 3, and
4.
e. Issue orders or directives under this chapter as follows:
(1) Order or direct persons subject to this chapter to cease and desist from
conducting business, including immediate temporary orders to cease and
desist.
(2) Order or direct persons subject to this chapter to cease any harmful
activities or violations of this chapter, including immediate temporary orders
to cease and desist.
(3) Enter immediate temporary orders to cease business under a license or
interim license issued pursuant to the authority granted under subsection 5
of section 13-10-03 if the commissioner determines that such license was
erroneously granted or the licensee is currently in violation of this chapter.
(4) Order or direct such other affirmative action as the commissioner deems
necessary.
2. The commissioner may impose a civil penalty on a mortgage loan originator or person
subject to this chapter, if the commissioner finds, on the record after notice and
opportunity for hearing, that such mortgage loan originator or person subject to this
chapter has violated or failed to comply with any requirement of this chapter or any
regulation prescribed by the commissioner under this chapter or order issued under
authority of this chapter.
3. The maximum amount of penalty for each act or omission described in subsection 2 is
twenty-five thousand dollars.
4. Each violation or failure to comply with any directive or order of the commissioner is a
separate and distinct violation or failure.
13-10-13. Surety bond and minimum net worth requirements - Surety bond required.
1. Each mortgage loan originator must be covered by a surety bond in accordance with
this section. If the mortgage loan originator is an employee or exclusive agent of a
person subject to this chapter, the surety bond of such person subject to this chapter
may be used in lieu of the mortgage loan originator's surety bond requirement.
a. The surety bond shall provide coverage for each mortgage loan originator in an
amount as prescribed in subsection 2.
b. The surety bond must be in a form as prescribed by the commissioner.
c. The commissioner may promulgate rules or regulations with respect to the
requirements for such surety bonds as are necessary to accomplish the purposes
of this chapter.
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The licensee shall maintain a surety bond in the amount as determined by the
commissioner by rule. The amount must be reflective of the dollar amount of loans
originated as of the previous yearend. However, the commissioner may increase the
amount of the surety bond if the commissioner determines that such an increase is
necessary to protect the public interests.
When an action is commenced on a licensee's bond, the commissioner may require
the filing of a new bond.
Immediately upon recovery upon any action on the bond, the licensee shall file a new
bond.
13-10-14. Minimum net worth required.
A minimum net worth must be continuously maintained for mortgage loan originators in
accordance with this section. If the mortgage loan originator is an employee or exclusive agent
of a person subject to this chapter, the net worth of such person subject to this chapter may be
used in lieu of the mortgage loan originator's minimum net worth requirement.
1. Minimum net worth must be maintained in the amount of twenty-five thousand dollars.
However, the commissioner may increase the amount of minimum net worth if the
commissioner determines that such an increase is necessary to protect the public
interest.
2. The commissioner may promulgate rules or regulations with respect to the
requirements for minimum net worth as are necessary to accomplish the purposes of
this chapter.
13-10-15. Confidentiality.
To promote more effective regulation and reduce regulatory burden through supervisory
information sharing:
1. Except as otherwise provided in Public Law 110-289, section 1512, the requirements
under any federal law or chapter 44-04 regarding the privacy or confidentiality of any
information or material provided to the nationwide mortgage licensing system and
registry, and any privilege arising under federal or state law, including the rules of any
federal or state court, with respect to such information or material, continue to apply to
such information or material after the information or material has been disclosed to the
nationwide mortgage licensing system and registry. Such information and material may
be shared with all state and federal regulatory officials with mortgage industry
oversight authority without the loss of privilege or the loss of confidentiality protections
provided by federal law or chapter 44-04.
2. For these purposes, the commissioner may enter agreements or sharing
arrangements with other governmental agencies, the conference of state bank
supervisors, the American association of residential mortgage regulators, or other
associations representing governmental agencies as established by rule, regulation, or
order of the commissioner.
3. Information or material that is subject to a privilege or confidentiality under
subsection 1 is not subject to:
a. Disclosure under any federal or state law governing the disclosure to the public of
information held by an officer or an agency of the federal government or the
respective state; or
b. Subpoena or discovery, or admission into evidence, in any private civil action or
administrative process, unless with respect to any privilege held by the
nationwide mortgage licensing system and registry with respect to such
information or material, the person to whom such information or material pertains
waives, in whole or in part, in the discretion of such person, that privilege.
4. Application of chapter 44-04 relating to the disclosure of confidential supervisory
information or any information or material described in subsection 1 which is
inconsistent with subsection 1 shall be superseded by the requirements of this section.
5. This section does not apply with respect to the information or material relating to the
employment history of, and publicly adjudicated disciplinary and enforcement actions
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against, mortgage loan originators that is included in the nationwide mortgage
licensing system and registry for access by the public.
13-10-16. Investigation and examination authority.
In addition to any authority allowed under this chapter, the commissioner may conduct
investigations and examinations as follows:
1. For purposes of initial licensing, license renewal, license suspension, license
conditioning, license revocation or termination, or general or specific inquiry or
investigation to determine compliance with this chapter, the commissioner may
access, receive, and use any books, accounts, records, files, documents, information,
or evidence, including:
a. Criminal, civil, and administrative history information, including nonconviction
data;
b. Personal history and experience information, including independent credit reports
obtained from a consumer reporting agency described in section 603(p) of the
Fair Credit Reporting Act; and
c. Any other documents, information, or evidence the commissioner deems relevant
to the inquiry or investigation regardless of the location, possession, control, or
custody of such documents, information, or evidence.
2. For the purposes of investigating violations or complaints arising under this chapter, or
for the purposes of examination, the commissioner may review, investigate, or
examine any licensee, individual, or person subject to this chapter, as often as
necessary in order to carry out the purposes of this chapter. The commissioner may
direct, subpoena, or order the attendance of and examine under oath all persons
whose testimony may be required about the loans or the business or subject matter of
any such examination or investigation, and may direct, subpoena, or order such
person to produce books, accounts, records, files, and any other documents the
commissioner deems relevant to the inquiry.
3. Each licensee, individual, or person subject to this chapter shall make available to the
commissioner upon request the books and records relating to the operations of such
licensee, individual, or person subject to this chapter. The commissioner shall have
access to such books and records and interview the officers, principals, mortgage loan
originators, employees, independent contractors, agents, and customers of the
licensee, individual, or person subject to this chapter concerning their business.
4. Each licensee, individual, or person subject to this chapter shall make or compile
reports or prepare other information as directed by the commissioner in order to carry
out the purposes of this section, including:
a. Accounting compilations;
b. Information lists and data concerning loan transactions in a format prescribed by
the commissioner; or
c. Such other information deemed necessary to carry out the purposes of this
section.
5. In making any examination or investigation authorized by this chapter, the
commissioner may control access to any documents and records of the licensee or
person under examination or investigation. The commissioner may take possession of
the documents and records or place a person in exclusive charge of the documents
and records in the place where they are usually kept. During the period of control, no
individual or person shall remove or attempt to remove any of the documents and
records except pursuant to a court order or with the consent of the commissioner.
Unless the commissioner has reasonable grounds to believe the documents or records
of the licensee have been, or are at risk of being altered or destroyed for purposes of
concealing a violation of this chapter, the licensee or owner of the documents and
records shall have access to the documents or records as necessary to conduct its
ordinary business affairs.
6. In order to carry out the purposes of this section, the commissioner may:
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Retain accountants or other professionals and specialists as examiners, auditors,
or investigators to conduct or assist in the conduct of examinations or
investigations;
b. Enter into agreements or relationships with other government officials or
regulatory associations in order to improve efficiencies and reduce regulatory
burden by sharing resources, standardized or uniform methods or procedures,
and documents, records, information, or evidence obtained under this section;
c. Use, hire, contract, or employ publicly or privately available analytical systems,
methods, or software to examine or investigate the licensee, individual, or person
subject to this chapter;
d. Accept and rely on examination or investigation reports made by other
government officials, within or without this state; or
e. Accept audit reports made by an independent certified public accountant for the
licensee, individual, or person subject to this chapter in the course of that part of
the examination covering the same general subject matter as the audit and may
incorporate the audit report in the report of the examination, report of
investigation, or other writing of the commissioner.
The authority of this section remains in effect, whether such a licensee, individual, or
person subject to this chapter acts or claims to act under any licensing or registration
law of this state or claims to act without such authority.
No licensee, individual, or person subject to investigation or examination under this
section may knowingly withhold, abstract, remove, mutilate, destroy, or secrete any
books, records, computer records, or other information.
13-10-17. Prohibited acts and practices.
It is a violation of this chapter for a person or individual subject to this chapter to:
1. Directly or indirectly employ any scheme, device, or artifice to defraud or mislead
borrowers or lenders or to defraud any person;
2. Engage in any unfair or deceptive practice toward any person;
3. Obtain property by fraud or misrepresentation;
4. Solicit or enter into a contract with a borrower that provides in substance that the
person or individual subject to this chapter may earn a fee or commission through best
efforts to obtain a loan even though no loan is actually obtained for the borrower;
5. Solicit, advertise, or enter into a contract for specific interest rates, points, or other
financing terms unless the terms are actually available at the time of soliciting,
advertising, or contracting;
6. Conduct any business covered by this chapter without holding a valid license as
required under this chapter, or assist or aid and abet any person in the conduct of
business under this chapter without a valid license as required under this chapter;
7. Fail to make disclosures as required by this chapter and any other applicable state or
federal law and regulations;
8. Fail to comply with this chapter or rules or regulations promulgated under this chapter,
or fail to comply with any other state or federal law, including the rules and regulations
thereunder, applicable to any business authorized or conducted under this chapter;
9. Make, in any manner, any false or deceptive statement or representation, including,
with regard to the rates, points, or other financing terms or conditions for a residential
mortgage loan or engage in bait and switch advertising;
10. Negligently make any false statement or knowingly and willfully make any omission of
material fact in connection with any information or reports filed with a governmental
agency or the nationwide mortgage licensing system and registry or in connection with
any investigation conducted by the commissioner or another governmental agency;
11. Make any payment, threat, or promise, directly or indirectly, to any person for the
purposes of influencing the independent judgment of the person in connection with a
residential mortgage loan or make any payment, threat, or promise, directly or
indirectly, to any appraiser of a property, for the purposes of influencing the
independent judgment of the appraiser with respect to the value of the property;
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12.
13.
14.
Collect, charge, attempt to collect or charge, or use or propose any agreement
purporting to collect or charge any fee prohibited by this chapter;
Cause or require a borrower to obtain property insurance coverage in an amount that
exceeds the replacement cost of the improvements as established by the property
insurer; or
Fail to truthfully account for moneys belonging to a party to a residential mortgage loan
transaction.
13-10-18. Mortgage call reports.
Each mortgage licensee shall submit to the nationwide mortgage licensing system and
registry reports of condition, which shall be in such form and shall contain such information as
the nationwide mortgage licensing system and registry may require.
13-10-19. Report to nationwide mortgage licensing system and registry.
Notwithstanding state privacy law, the commissioner is required to report regularly violations
of this chapter, as well as enforcement actions and other relevant information, to the nationwide
mortgage licensing system and registry subject to the provisions contained in section 13-10-15.
13-10-20. Privately insured credit unions.
Nonfederally insured credit unions which employ loan originators, as defined in Public Law
110-289, title V, the S.A.F.E. Act, shall register such employees with the nationwide mortgage
licensing system and registry by furnishing the information concerning the employees' identity
set forth in section 1507(a)(2) of Public Law 110-289, title V.
13-10-21. Unique identifier shown.
The unique identifier of any person originating a residential mortgage loan shall be clearly
shown on all residential mortgage loan application forms, solicitations, or advertisements,
including business cards or websites, and any other documents as established by rule,
regulation, or order of the commissioner.
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